Thursday, 30 October 2008.
The Committee met at two o'clock.
[The Deputy Chairman of Committees (Baroness McIntosh of Hudnall) in the Chair.]
I remind the Committee that in the event of a vote in the Chamber, the debate will adjourn for 10 minutes from the sound of the Division Bells in order to allow noble Lords to vote. It has been agreed that, should any of the Questions for Short Debate not run for their allotted hour, the Committee will adjourn during pleasure until the end of the hour. Therefore, each of the Questions for Short Debate will start on the hour. In the event of a vote, the time lost will be added to the allotted time for the debate.
Women in Public Life
asked Her Majesty’s Government what measures they will take to encourage the full participation of women in public life.
The noble Baroness said: The Equality and Human Rights Commission has recently published a document entitled Sex and Power 2008, which shows how slow women’s progress is in all fields of political and public life; the document calls it “a snail’s pace”. The House of Commons is a good example of how slow women’s progress is. Since 1918, when women were first able to stand as Members of Parliament, only 291 women have been elected, but during that same period 4,363 men were elected. If it was possible to put all the women who have ever been elected into the House of Commons today, they would still be in the minority. Women have been able to sit in your Lordships’ House since 1958 and, to date, 1,044 men and 198 women have been appointed as Peers: 84 per cent men and 16 per cent women. So whether elected or appointed, women are, and always have been, a minority in both Houses.
In other walks of life have women fared any better? The Sex and Power report talks about the “missing women”. It says:
“If women hope to shatter the glass ceiling and achieve equal representation we would need to find over 5,600 women ‘missing’ from more than 31,000 top positions of power in Britain today”.
This includes all public appointments, business, local authorities, media, civil servants, senior judges and, of course, the missing women in the Commons—198 more women are needed, and in your Lordships’ House we need another 225 to achieve equal numbers. Can the Committee imagine what the House of Lords would look like with those additional 225 women?
However, there are some good stories. In the nine years since the first elections to the Welsh Assembly, there has always been a good number of women elected. In fact, the 2003 elections saw the Welsh Assembly become the first democratically elected legislature in the world to have an equal number of men and women. As far as Wales is concerned, this did not happen by accident. The Labour Party, in readiness for the first elections to the Welsh Assembly in 1999, took a decision to field an equal number of women and men candidates. That was not as easy as it sounds—I know, as I was there—but as a result more Labour women were elected than Labour men, showing that the electorate do not discriminate when it comes to electing women candidates. The problem lies not with the electorate but with the political parties, as their members are reluctant to select women candidates. Unless action is taken, such as through the Labour Party policy of all-women shortlists, this problem will persist.
I have given up believing that over time prejudice against women will be overcome. None of us will be here long enough to see that happen. Today we live in a society in which women are in most cases unable to achieve their full potential. How can this be dealt with? Can government, in bringing in equality laws, change the perceptions, prejudice and culture that exist? I believe that laws can go some way in helping women. I am thinking of laws such as the Sex Discrimination (Election Candidates) Act 2002, which allows all-women shortlists, the Equal Pay Act and the Sex Discrimination Act. Soon we will be debating the new equality Bill. We also have the national minimum wage, two-thirds of the beneficiaries of which are women, and the right to ask for flexible working.
On public appointments, in May this year the Women’s National Commission began working with the Cabinet Office on a new initiative to encourage more women to apply for posts on public bodies. I declare an interest: I serve as the commissioner for Wales. The commission will work with four government departments, as well as the Appointments Commission, publicising the current adverts for posts on the boards of public bodies and encouraging women with the specific skills and experience to apply for these posts. By sharing information on public appointments and engaging with women about the importance of their representation within public appointments, the Women’s National Commission believes that it will be doing all that it can to encourage women to apply for these posts.
I was interested to learn that the Prime Minister has asked the Speaker of the House of Commons to convene a Speaker’s Conference. The conference has been asked to:
“Consider, and make recommendations for rectifying, the disparity between the representation of women and ethnic minorities in the House of Commons and their representation in the UK population at large; and to consider such other matters as might, by agreement; be referred for consideration”.
The conference is expected to report its recommendations in 2009. The first such conference, in 1916-17, secured cross-party agreement on the principle that women should have the right to vote. It led to the Representation of the People Act 1918, which extended the right to vote to women over 30 years of age. If the recommendations of this present conference are as powerful as those of the 1916-17 one were, we should expect great things.
In a recent announcement, my right honourable friend Harriet Harman MP, the Minister for Women and Equalities, spoke of the setting-up of a national equality panel, which will gather and examine data from the last 10 years, as well as using current information, and will commission new research where necessary. It aims to provide an analysis of how equality trends have changed over the last 10 years, mapping out exactly where gaps have narrowed or widened in society. When the report is published in late 2009, it should give us a better idea of how equal our society is, and I hope that we may get some solutions.
However much legislation is brought in, government cannot do everything in terms of changing attitudes. It is difficult to deal with the prejudice in some people’s minds against equality for women; they are bound up by their own culture and prejudice. Would it make a difference, I wonder, if boys and girls were from an early age taught mutual respect in a gender-free style? Girls and boys should be taught that they are capable of doing whatever they wish. No doors should be closed because of gender. Does my noble friend the Leader of the House think that this could be achieved?
Many countries now use a quota system to ensure that women are elected and that has proved to be successful in bringing more women into public life. Could we use such a system in the UK? I think that that is worth looking at. We should learn from other countries that have tried to tackle the underrepresentation of women in political life.
There are so many women with the talent, ability and merit to rise to the top, but they are not allowed to get there because of cultural attitudes in organisations and of individuals. Changing attitudes is a lot harder than changing the law. The glass ceiling is there, unseen but obvious. When Hillary Clinton made her speech conceding to Barack Obama, she said:
“Although we weren’t able to shatter that highest, hardest glass ceiling this time, thanks to you, it’s got about 18 million cracks in it, and the light is shining through like never before, filling us all with the hope and the sure knowledge that the path will be a little easier next time”.
That is what it is all about. Each one of us can make a difference in whatever field we work in. We can make a difference and make it easier for the next women who come along. It is a long path that we have to travel, but perhaps, with the help of a sympathetic Government, we can make that road less bumpy for the next generation of women. I look forward to the response from my noble friend the Leader of the House.
I thank my noble friend for securing this debate and for giving us the opportunity to focus on an issue that is dear to the hearts of so many of us, as women and as parliamentarians. We are mostly people who became parliamentarians as a result of participating in public life. I endorse the comments of my noble friend in validating the steps taken by the Labour Government to increase the participation of women. Your Lordships’ House, as only one example, is a very different place in composition and, I venture to suggest, in culture since I first entered in 1997. Much of that change is due to the increased number and participation of our women Peers.
I also acknowledge the commitment of the Civil Service and local authorities to encouraging women. Only last week, the Women in Public Life Awards were launched for this year; the noble Baroness, Lady Finlay, has been a recipient in the past. I think that there was a series of stamps with women’s heads on them indicating the success of some women in public life. The Cabinet Secretary puts time into this. We have seen some increase in the number of women councillors, while the voluntary sector is famous for its women leaders. And yet, and yet. Any glance at the numbers shows us that progress is painfully slow. There are fewer women as permanent secretaries than there were five years ago and, even in the voluntary sector, where huge numbers of women work, the number at the top, as chief executives or chairs, is very small.
We must conclude, as my noble friend has done, that the problem is more cultural than structural. That is what I will focus on in my brief time today. I shall highlight two aspects of culture, both of which can be found in women themselves and in wider societal attitudes. The first is the reluctance of women to put themselves forward. We all know—do we not?—that an ambitious man is tough, hard and focused on success, whereas an ambitious woman is strident, shrill and unfeminine. Of course that is not true, but those images are firmly embedded. Moreover, women are usually good at negotiation rather than confrontation and are often relaxed about letting someone else take the credit that is rightfully theirs. I see nods from noble Lords. Women know that that is the way to get things done, but it does not always get you noticed by those who can advance and promote you.
Moreover, the media focus on the personal is considerably more off-putting to women than to men. Whatever our personal views of Hillary Clinton or Sarah Palin, I doubt that any of us would condone the attention paid to the colour of the one’s trouser suit or the shape of the other’s spectacles. I do not remember the husband of a Prime Minister being pilloried or praised for the cut of his suit or the type of shoes that he wore to hear his wife’s speech to a party conference. Is it any wonder that women may be reluctant to enter politics, when the Home Secretary is judged more by the shape of her neckline than by the quality of her argument?
The other area to which I want to draw your Lordships’ attention is how poor we are at acknowledging the transferability of skills and experience from one field of life into another. Women who have taken time off to bring up a family often report huge difficulty in convincing an employer that their time has been profitably spent and that it has developed, rather than stultified, their skills. Any woman who has run a household, managed a budget and organised after-school activities, while cooking the dinner and setting up a package of care for her elderly mother, has all the skills and more to be an efficient manager. That is leaving aside all the negotiation that she has done as a matter of course with the school, the surgery, the local authority and the Inland Revenue. Yet how often is that acknowledged, not least by women themselves, who do not know how to package up the skills so as to look good on the CV, or how to fill in the application form in a way that is sufficiently economical with the truth to get her an interview, a skill at which most men are adept? Even when you are well established in public life, it is difficult to get anyone to see that skills learnt in one part of life are easily transferable to another. Many of us around this Table have had that experience.
Addressing such entrenched attitudes is the next stage of development in our crusade to get more women into public life. We must start early. I commend the Lord Speaker’s programme and all colleagues who work with schools. We must develop the best possible role models and encourage women who are successful in public life to sponsor others—our daughters, our granddaughters, our younger colleagues. We must be prepared to undertake what can be the most rewarding, as well as the most challenging, of occupations.
We should, of course, challenge sexist attitudes where we find them but, like most women, I have found the carrot rather more effective than the stick when it comes to culture change. The rewards of encouraging women into public service should always be emphasised, using the wealth of talent available and encouraging flexibility in the workforce—I seek assurance from my noble friend the Leader of the House that the current economic situation will not discourage us from doing that. Above all, we must seek to develop the acknowledgement of the strength and relevance for the whole of our population of encouraging more women.
I just make the point that, if noble Lords do not stick to their four minutes, we will lose the remarks at the end of this hour, because it is a timed debate. When the clock clicks to “4”, that is when you need to sit down, not when it goes through the fourth minute.
I shall watch the clock. I am delighted that my noble friend Lady Gale has opened a debate again on women’s issues and delivered such a challenging opening speech.
Today I shall focus on what has been done and is being done to interest girl children—and boy children—and encourage them to have the confidence, inspiration and information to get involved in public life when they are older, points touched on by my noble friends who have just spoken. In doing this I shall refer to two things: first, encouraging young people to visit Parliament and having parliamentarians visit schools; and, secondly, the importance of developing self-esteem in schoolchildren, helped by personal, social and health education.
I was excited last week by the launch of the parliamentary educational website. It is well worth a visit. I have it here in front me here—not the website, the books. The Parliamentary Education Service has expanded enormously and is doing a great job of letting schools and young people know about its services. I was also excited last week by the fact that personal, social and health education is to be a compulsory part of the curriculum for all children at last. The aims of the Parliamentary Education Service are to inform young people about the role, work and history of Parliament; to engage young people in understanding the relevance of Parliament and democracy through active learning; and to empower young people to get involved by equipping them with the knowledge and skills to take part.
The DVD and booklet for schools are called You’ve Got the Power. What a splendid message for young people to receive about involvement in public life. Some of the areas covered are: using your vote; MPs and Lords; debating and voting in a parliamentary way; and influences on the UK Government. There is much more. The Parliamentary Education Service provides resources for schools, encourages visits to Parliament and organises student parliaments where schools can prepare a debate and carry it out in Westminster. There are 10 of these each year. Teacher training workshops in schools, videoconferencing and visits by Peers and MPs are also organised.
Why is all this important? Many young people, not just girls, are simply not aware of, and not interested in, government at a local or national level. Unless that attitude is addressed, they will grow up disaffected and may not participate, either by getting involved in government or public life or by voting. If we catch them early, that cycle may be broken. They, particularly girls, need to feel that Parliament and governance belong to them. When I take school groups around Parliament, which I do fairly frequently, I always stop at the statue of Viscount Falkland in St Stephen’s Hall. That, of course, is where the suffragette, Marjory Hume, chained herself to Falkland’s sword and was dragged off by the police, breaking the sword, which is now repaired but still shows the crack. What better reason for saying that every woman should vote? This always makes a great impression on children.
I move on to personal, social and health education, which will now be compulsory in schools and will have its own curriculum—of course we already have citizenship education. PSHE is not about sex and drugs for five year-olds, as some media imply; rather, it is a serious attempt by the Government to give young people information at the appropriate age about their bodies and about relationships. But it is not just about information; it is also about exploring values and attitudes towards other people and encouraging honest and open relationships. I like what one young person said about sex education:
“I understand the science side pretty well, but it seems a bit like a pencil—I know it’s made from wood and graphite that gets broken off, but does that tell me how to write?”.
The analogy is clear. We have a duty to ensure that every young person is emotionally, socially and politically articulate and educated.
I have spoken briefly about two aspects of education that I think are important in developing the confidence and involvement of young people. Can my noble friend reassure us that the Government will continue to support such education for boys and girls?
It is always challenging to take part in any debate raised by my noble friend Lady Gale and this one is no exception. I join others in thanking her for keeping equality on the agenda. I have used the word “challenging” because such debates encourage the House to look at the progress made in the quest for equality and for me to look especially at black women. How are black women faring in the equality stakes in the two areas highlighted by the debate?
Before repeating the statistics that I have gleaned from the second Sex and Power report, which has already been quoted in the debate, I want to share a brief anecdote. When I was sitting in the Tube with two women colleagues recently, the conversation veered towards the discrimination against women still in existence. My colleagues concluded that women have a long way to go because men have so cleverly constructed a society for their own benefit and comfort. At that point I interjected, “Consider yourselves lucky. You only have to deal with gender discrimination. In my case it is double discrimination, both race and gender”. They looked at me and said, “Well”, and there ended the conversation.
That incident has prompted me to repeat some statistics from the 30-page Sex and Power report. On page 16, 11 lines are devoted to ethnic minority women. The report states:
“The glass ceiling is low for most and lower for some”.
I also gleaned the following statistics. There are only two black women MPs, eight black women Peers, no black women AMs and no black women MSPs. Only eight black women are directors of FTSE 100 companies and we have one black woman High Court judge. Given that Britain is changing, it beggars belief how slowly the wheels are turning. Population statistics show that four-fifths of the growth in the working-age population in the UK comes from ethnic minorities. It appears that the workplace, company boards and Parliament have not kept up with the significant implications for the way in which Britain works. If there are not enough black women around the boardroom table or in Parliament, will there ever be change?
I believe that there has to be change. Britain must wake up and encourage more black women of talent to compete equitably for places in public life. It also begs the question: is Britain failing not only its black women but the whole of the black community? Can Britain afford the luxury of doing this, or is our country losing out?
I know that the Leader of the House is currently encouraging black women to be engaged in the system. Is she engaging the women who can really help? Unlearning racism is an art. Most very nice people are racist and do not even know it. To move the dialogue forward, we need to be careful when choosing the women who will advise—women who have succeeded despite racism in the institutions and who are capable of moving others to realise what is actually happening and how subtle it is.
There is no place for discrimination of any kind in the 21st century. Several changes must take place. Dynamic women and men must embrace this time of recession visibly to encourage women, whatever their colour, to work in areas that seem to be held for men and to say no to the inflexible approach to work.
I am grateful to the noble Baroness, Lady Gale, for raising this important issue once again. I pay tribute to her tireless efforts in this area, but do so with fatigue and anger. Like many people around this Table, I have spent more than 30 years arguing and making precisely the points that are being made today. Progress has been dismally little. It is time for radical action. It is time for us to find the political will to make real and fundamental change, because we are wasting the resources of our country. Because of the innate sexism in our system, we are wasting the money that we spend on girls’ education and we are wasting the opportunities that we provide for them.
We will overcome this only by having a system of quotas that ensures that equal numbers of men and women participate. The Government, who have made all-women shortlists lawful, could quite easily say that there will be all-women shortlists in all public appointments, particularly for leadership positions, until there are equal numbers of men and women holding public appointments.
Our plcs should be required to have equal numbers of men and women on their boards. Until we become accustomed to seeing women in leadership positions, we will never achieve true equality. We have spent years touching around the edges, with training schemes and with opportunities here and opportunities there. It has not worked.
I do not intend to take up my whole four minutes. I simply want to make this point as forcefully as I can: it is time for real action, not simply the sort of thing that makes people feel good and feel as though they are doing something when what they are doing actually changes nothing. I donate my remaining two minutes to my colleagues.
It is a great honour to be here and to support and salute the work of the noble Baroness, Lady Gale, and that of my other distinguished noble friends—and sisters, if I may be so bold to say. It feels very comfortable to be here. Yes, we are playing the broken record once more, but it is important to do so.
I shall say something about the work that I am doing with the Government’s task force and something about my own work. Having just come from America, I have become convinced that we need to shout more about the work that we do, because none of us knows enough about the work that many of our colleagues are doing to promote women’s participation in every way.
I have not written a speech. Instead, I Googled “British women” an hour ago. The first thing that came up was about how American women are more attractive than British women. Then it says, “British history”; then it says something about British women and our opinions about Palin. The mind boggles at what £150,000 could have done to my image with a little bit of attention from the British media. I will let you wonder, but I do not think that achieving equality is so simple. Then comes women suffragettes. I stopped there because I thought, “This is going to be really depressing”.
Then I Googled “British Muslim women”. What can I tell you? The results were about how single Muslim women are dating, about how attractive or not the girls are and about preventing extremism. There was nothing about power, representation or participation. Then there was something about Muslim voices. I say this because that is the position of women in the public arena; the position of minority women, in particular, is nowhere.
I am pleased to be able to chair the task force, which is encouraging women. It is a cross-party task force and I urge all my colleagues to support it. I have just come from a women’s event where there were a number of women Ministers, but no reference was made to the work that the Labour Government are undertaking. It is a very successful cross-party effort; I am making my best efforts to ensure that we go beyond party politics and encourage all women.
About a week ago, we were in Birmingham, undertaking a successful event as part of encouraging more women to come forward. Often we hear that not enough ethnic minority women are interested in or capable of coming forward and taking part in public life. I have done work for the Government chairing various task forces and groups on women and women’s position and I know that that is not true. I am really pleased that once again we are proving that there is no shortage of such women. There were more than 200 women saying, “Yes, I want to be this”, “I want to be a magistrate”, “I want to be a Member of Parliament”, and even, “I want to be in the Lords”. Despite the democratic deficit elsewhere, we have done quite a lot to make up for what is lacking in the democratic process.
I was really pleased with the ambition that many of those women demonstrated, but ambition is not enough, because of the lack of opportunities. I echo what my noble friend Lady Kingsmill just said: we must take radical action and acknowledge each other’s work. Only by strengthening what we are doing can we come out of this quagmire, this devastating position. Even the Labour Government have become somewhat complacent, having achieved that remarkable progress back in 1997.
Is my noble friend Lady Royall satisfied with the changes that have been made? Does she recognise that many of us, including me, have been tireless in the campaign? What will she do to ensure that that is acknowledged in the public arena? How will she encourage minority women and make sure that opportunities are real, not just about a task force or profligate comments about how we are doing everything that we can? That is no longer good enough. Every ounce of our effort must be made to show that we mean what we say, which is that we believe in equality. I apologise for going over five minutes.
I, too, begin by thanking the noble Baroness, Lady Gale, and congratulating her on securing this debate. I must say that I feel slightly uneasy because I seem to be the only male Peer speaking in the debate and the only one present. That tells us something about how these debates have a tendency to be ghettoised, which precisely illustrates the problem that we are debating this afternoon.
In spite of persistent pressure, anti-discrimination laws and the Labour Party’s commitment, the representation of women in our public life remains deeply disappointing. Let me give the Committee some basic facts about not only politics but other areas of life. In politics, as we have already been told, 20 per cent of MPs are women; women make up 19.7 per cent of the House of Lords, although an outsider may be forgiven for thinking that the proportion is much larger, partly because, I am told, women tend to attend more often and for longer hours than men. Twenty-six per cent of Cabinet Ministers are women, as are 20 per cent of candidates in parliamentary elections. Of public appointments, 36 per cent go to women. Although I do not have exact statistics, I am told that about 30 per cent of higher honours in the honours list go to women. Women make up 9.26 per cent of High Court judges and 26 per cent of senior civil servants. Public life appointments speak for themselves.
In education, 8 per cent of vice-chancellors are women. There should be no discrimination in the appointment of deans and heads of department, but only about 19 per cent are women. In the economy, 11 per cent of directors of FTSE 100 companies are women and, of senior managers and people in high positions, about 18 per cent are women. In the media, women make up 16 per cent of senior editors and programme organisers and 30 per cent of senior columnists and journalists. I can think of hardly any walk of life, other than magistrates, where the proportion of women broadly corresponds to their proportion in the population.
The position is even bleaker in respect of ethnic minorities, who make up 0.3 per cent of MPs, 1.4 per cent of Peers and 0.9 per cent of councillors. This need not be. In other countries the figures are in some respects much better. In Sweden, the Netherlands and even South Africa the figures for the representation of women in Parliament are closer to the proportion in the population. But in universities and the media, the situation is just as disappointing. I cannot think of any country that sets an example to us in all walks of life.
The question is: what do we do? Different factors are responsible in different areas. It is no use trying to think of one answer that will work in all areas of life. Therefore, we will need different strategies for underrepresentation in politics, in academia, in the media and so on.
We need to think more carefully about two or three things. First, women are underrepresented partly because of their conditions of work, such as inflexible working hours, lack of childcare facilities, irregular hours of work and promotion policies that take no account of breaks in service.
Another factor concerns masculine culture and ethos. Just as I almost felt intimidated in the company of only female Peers, I can understand easily how women would feel in an all-male environment, as I can vouchsafe as a vice-chancellor and as a head of department. The ethos tends to be such that people feel intimidated. Thus there is a vicious circle. We need more women—a critical mass—to break the ethos, but we will not be able to do that unless there are more women in the first instance.
Finally, in public life, we need to bear in mind media stereotypes. As one of my colleagues said, the media are far more invasive and more personalised in their comments about women. I can easily understand why women would feel reluctant to expose themselves and their private lives to media scrutiny and allow their personal integrity to be violated by these kinds of aggressively invasive media, which seem to single out women far more than men.
A profound cultural revolution needs to take place. The law can take us only so far. History teaches us one lesson: it is easier to tackle all areas of discrimination in the first instance, when the Government enact the law, but, once law reaches its limits and cultural changes are required, things become more difficult.
I thank my noble friend Lady Gale for securing this debate. I will not go over the statistics or arguments put forward by some of my colleagues. Since 1997, we have had three Labour Governments, with two enlightened Prime Ministers, Prime Minister Blair and Prime Minister Brown, and an enlightened European Commission. Life has changed enormously for women in this country, although perhaps not as much as we would like.
I disagree on one point: the quota system. I have been very lucky never to have had to deal with the quota system. I was elected as a local authority councillor by an all-male union, the Post Office union, as it was then, and then I had other appointments. However, that was in the days when there was change.
People talk about quotas here and in other countries. There are quotas in countries that have been at war or where women have never stood for the parliament. To persuade those countries to have women standing for parliament, you had to have the quota system. The figures that are often quoted about high numbers of women in parliament following wars are for Afghanistan, Rwanda, other African countries and Northern Ireland. Those countries have quota systems because women there sat outside the peace talks—they are doing it now in Darfur—and they sat there until they were allowed to come to the peace table. Part of the deal with the UN and other countries involved in getting peace in those countries was that women became members of parliament there.
Figures are bandied about showing that there are more women in parliament in such countries, as is true, and that is because quotas were put in place to get women in parliament to make sure that peace was brokered and kept. When you have women at the brink of peace, they can stop a lot of what is happening. Women have stopped suicide bombers and women will continue to ensure that we have peace in this world. I feel strongly about quotas.
When you have women in power, as we have today, they can make a difference in three areas. By making a difference, we can bring other women into public life. First, there is the economic situation; secondly, there is the political situation; and, thirdly, there is the human rights situation. We can make a positive difference in those areas if we encourage women by example and through education. We must ensure that teachers in teacher training colleges understand that women have the right to attain any position that they want. Wherever they come from, we should ensure that women are told at school and thereafter, “You have a right”. We have to change the political situation in the political parties. We should be saying to our colleagues in the Labour Party, the Conservative Party, the Liberal Democrats and other parties that they must change their system of how they elect people at every level.
In the same way, we should try to become part of every situation to elect or appoint women. Women are bad to women. Looking at the number of women in public life and at public appointments, we see that women do not select women. The same goes for women headhunters. They ring me up about positions and say, “What about so and so?”. When I ask whom they have on the shortlist, I find that they do not have a woman on it. We should be encouraging headhunters to have women on their shortlists. If they do not know about the women whom we are talking about, we should be saying to them, “These are the women who should be brought to the table”.
Women can also make a change in skills and training. That is why we should be on the skills and training boards and why we should be part of ensuring that women can attain these skills. We need women in engineering and in science, which have the lowest numbers of women training. Women have a right to be there.
If you invest in women, you invest in the rest of the world. The best thing that you can do with such money is to invest in women; they are the best workforce. In countries that invest in women, such as our country, the GDP goes up. When women in the workforce enjoy where they are working, they stay there and you do not have constant change. Working women can educate their sons to respect women and to be on equal terms.
The noble Baroness, Lady Gale, has a splendid record of promoting women, as is attested by the wonderful balance of men and women achieved in the Welsh Assembly. We all congratulate her on that and we all know of her huge contribution there. At the same time, I recognise that the Government have over the years genuinely tried to promote the cause of women and tried to make things better and easier for them and more available to them.
Years ago, I played a bit part in the then recently founded Liberal Democrats as the person organising the selection process for candidates in the English party, which is, of course, by far the biggest of the three parties making up our joint party. I became increasingly aware that the problem for women is not so much getting elected, because women tend to attract more voters than men overall, but getting selected. I was quite amazed by the number of excuses that could be made by the chairs of committees: “Of course I am absolutely in favour of more women in Parliament, but this constituency is too big, too small, too rich, too poor, too urban, too black, too white”. Any reason that you could think of was a good reason for not promoting the woman who had to be on the shortlist—we have, or we had in those days, a vague quota system.
Perhaps we should not be surprised that the current proportion of women in the House of Commons is only 20 per cent, but it is an absolute disgrace after 90 years of voting for women and women being allowed to become Members. Incidentally, in 1906, when Finland escaped from Russian control, it gave women the right to vote and the right to stand in its first parliament, to which women were indeed elected. We have a long way to go in some ways.
I was sad to note that the same sort of poor proportion applies in local government, albeit a little better than in the House of Commons—30 per cent rather than 20 per cent. I have quite long experience in local government of various forms. In my experience, women have been brilliant chairs of committees, excellent leaders of councils and very good at heading hospital committees and school governing bodies. Where would school governing bodies be if there were no women? They would not be filled. Those are all important positions in public life.
Why do we care whether there are more women, fewer women or not enough women in Parliament? There are two reasons. Women are today at least as well educated as men; indeed, they are probably slightly better educated and more successful in the educational process than men. Why are we not profiting from the input that we have made as a society into women’s improvement in education by ensuring that they are promoted in the right way? It is a real sadness that in big companies there are fewer women in the governing bodies than there were a few years ago. Things are not getting better in that field; they are getting worse.
Also, women’s perspective on life is not the same as men’s. They do things in a different way—a way that men find unsympathetic. If you get five women together talking about something, they say, “Oh, that’s a good idea, we’ll do that”. Within 10 or 15 minutes, you have the beginning of a plan to address the problem. It is much less formal; it is much less about, “He’s the boss and I’m his inferior”. We do not think in that way, especially in this House, where, by definition, we are all equal.
Women could contribute to better legislation and better administration by bringing some of those feminine ways of doing things, based on good education, alongside the male way of doing things. If I could give the Government one word of advice—I know that they will not accept it—it would be to introduce proportional representation. Do not laugh. The best way of getting more women into elected bodies is to have proportional representation.
I am aware that I am already eating into the Minister’s time, so forgive me if I try to keep my remarks as short as I can. I, too, am grateful to the noble Baroness, Lady Gale, for raising this important issue today. I am especially pleased to speak, as I have spent 40 years championing the promotion of women. I have never been obsessed by equality of numbers. It is a useful tool but, like the noble Baroness, Lady Kingsmill, I have been motivated by thinking of the wealth of talent that the country is missing out on.
As has been said, this year marks the 90th anniversary of some women first being granted suffrage in this country. Like my colleague in another place, the shadow Minister for Women and Equalities, Theresa May, I firmly believe that we must use the anniversary of women’s suffrage as an opportunity to promote further discussion on how to improve the role of women in politics in the UK and internationally.
It was not until 1918 that women aged 30 or older were allowed to vote and to stand for Parliament and not until 1928 that women had the vote on the same basis as men. The wheels of change grind slowly indeed and we must maintain our determination to see men and women equally represented in public life. I understand that the UK is ranked 51st equal in the world and 13th in the European Union—not a happy place to be. The picture is only slightly better away from Westminster. The proportion of women in the Scottish Parliament is 33 per cent and the proportion in local government is about 29 per cent. Only in the National Assembly for Wales, as the noble Baroness pointed out, does the proportion of women Members come close to genuine parity—it is just under half.
It is worth saying that the Government may wish to start a little closer to home before they begin preaching to public bodies through the equality Bill. It saddens me to say that they have failed to tackle the significant glass ceiling in the Civil Service. Across all departments, women fill only 31 per cent of senior Civil Service positions. In the worst-offending departments, such as the MoD, they fill as few as 13 per cent of senior positions. On top of this, the gender pay gap in government departments is significantly higher than the national average of 17.2 per cent. In the Treasury, the pay gap is a staggering 26 per cent. In the MoD, it is 22 per cent. Clearly this needs to be rectified. The Government need to get their own house in order to be credible.
We need not heed the words of those who say that there is no need for positive action to redress the balance when eight out of 10 Members of Parliament are men. We should not listen to those who argue that positive action invalidates the achievement of those who benefit from it. We completely disagree with these arguments. As the Leader of the Opposition, who has done so much to begin to usher in the necessary changes in the Conservative Party, has said, it is about political effectiveness. To create effective policy, we must involve those who are affected by it. We should all take notice of those words as we consider what can be done to increase the participation of women in public life. We must continue in our determination to reach our goal.
I am grateful to all noble Lords who have spoken this afternoon, but especially to my noble friend Lady Gale, whom I thank for another inspiring and thought-provoking debate; I am sorry that they have to keep occurring. I pay tribute to her especially for the way in which she changed the gender landscape in politics in Wales, because it is largely thanks to her that we have what we have in the Welsh Assembly.
I am also delighted that my noble friend Lord Parekh has spoken this afternoon; he is right to say that this becomes a ghettoised issue, when it is important for men as well as women in our society. We must deploy the talents of all society, not just 50 per cent of it.
The noble Baroness, Lady Seccombe, rightly told us that 2008 is a year of anniversaries for women. We have reached other milestones, too. My noble friend Lady Ashton is the first UK female Commissioner and, this year, Manjula Sood became the first Asian woman lord mayor in the UK. We celebrate these achievements, but progress is shamefully slow.
I share the anger and frustration at the fact that the glass ceiling is still there, albeit now cracked as a result in this country of many of the Government’s policies. Women face too many barriers to entering public life and senior positions more generally. These barriers include caring responsibilities, the culture of institutions such as Parliament, and low confidence. However, as many noble Lords have said, changing the culture is critical. It is vital that we all work together to overcome these barriers.
One way to overcome the barriers is through education. Like my noble friend Lady Massey, I pay tribute to the educational outreach of this House. The teaching of citizenship is, of course, important, but the fact that more girls now go on to higher education gives me most hope that my daughter’s generation and those that follow will succeed where we are failing. Education brings confidence and gives girls self-esteem. I wholeheartedly agree with the need for gender-neutral education.
Young people have many opportunities both at school and outside to engage in political activities, such as on school councils and the UK Youth Parliament. It is encouraging that, in 2006, 53 per cent of the UK Youth Parliament’s members were female. My noble friend Lady Pitkeathley rightly said that we have to educate women in packaging their skills. I will write to her, and copy the letter to all noble Lords present, about some excellent examples.
We need women in key decision-making positions. We need them on public boards, in our institutions and on primary care trusts. We need them everywhere. What better way is there to ensure that the health needs of a whole community are met than by having women on PCT boards?
We know that democracy is stronger when it is fully representative. We have heard about the House of Lords and the House of Commons. It is shameful that we have only two black female MPs and that there has never been an Asian female MP. My noble friend Lady Howells was right to cite double discrimination. It is not acceptable. All women, including black and ethnic minority women, want to have a say in decisions made locally and nationally.
Many noble Lords have spoken about the shamefully snail’s-pace progress outlined in the Equality and Human Rights Commission document. This Government are committed to increasing women’s representation in political and public life. The Government have taken action—I will have to circulate a lot of information on the action that they have taken. The equality Bill is coming up, which will be an important means of redressing some of the power balance. But, at this time of economic downturn, it is especially important that we continue to act on these issues. In the past, women have been hit disproportionately in economic downturns. We must not let that happen now.
Democracy must be nourished at its roots. It is vital to consider decision-making at a local level. In December 2007, the Councillors Commission published a report on the barriers and incentives to standing as a local councillor. It highlighted the need for a more diverse pool of people holding these roles. At the moment, women make up 29.3 per cent of local councillors, of whom only 1 per cent are black, Asian or from an ethnic minority. I am delighted that my noble friend Lady Uddin chairs the local task force about which she told us.
The Government are supporting many initiatives, such as the FTSE 100 cross-mentoring scheme, which aims to increase the pool of eligible senior female candidates for board positions. As noble Lords have said, it is good that many women now want to come forward, as seems to be the case in the task force, but we also have to provide the opportunities.
In this House, we have some extraordinary women who have overcome the barriers. In addition to being Peers, they run families and organisations. They are on the boards of companies, charities, voluntary organisations et cetera. Not only should we be proud of these women, but we should use them whenever and wherever possible as role models to nurture and foster change in our society, so that the full participation of women in public life becomes the norm rather than the exception. I believe that that is our duty. The challenge that we have discussed today is an issue not only for the present but also for future generations, who need to see role models in these positions so that they can be inspired to step forward.
asked Her Majesty’s Government what steps they are taking regarding the prevalence and treatment of asthma.
I suggest that we adjourn for five minutes.
[The Sitting was suspended from 3.01 to 3.06 pm.]
As someone who has severe brittle asthma, and who can have a serious attack within a few seconds following the inhalation of certain triggers, I am pleased to have secured this Question for Short Debate on asthma. Four and a half million—that is, one in 11—people in England are currently receiving treatment for asthma, making it one of the commonest long-term conditions. An estimated 10 per cent of people with asthma—that is, 450,000 in England, including me—have difficulty controlling asthma, which impacts significantly on their health, life chances and quality of life.
This Government have delivered some real improvements for people with asthma. In particular, the smoking ban allows us to work and socialise in smoke-free environments and will help to reduce the impact of asthma in the future. But we must not be complacent. Asthma UK has estimated that, with correct asthma management, up to 90 per cent of deaths from asthma, and up to 75 per cent of hospital admissions due to asthma attacks, could be prevented.
Today I want to highlight the fact that much more needs to be done and to urge the Government to focus on driving up standards of asthma care and treatment by introducing a national clinical strategy for asthma. Many people assume that asthma is not serious because it should be possible to control in most cases, and most people have little conception of what an asthma attack is like. But asthma is serious. On average, one person dies from asthma every seven hours in the UK. Hospital admissions for asthma are increasing, having previously declined. Too many people suffer in silence with symptoms that are bad enough to cause them difficulty sleeping and to interfere with their usual activities. An Asthma UK survey of more than 1,000 people with asthma found that 69 per cent of people did not have their asthma under control as defined by Royal College of Physicians standards.
Asthma UK’s recent Wish You Were Here? report identified a postcode lottery in hospital admissions. Most shockingly, children living in Liverpool have an almost eight times higher chance of emergency hospital admission for asthma than children living in Richmond and Twickenham. Asthma is one of the top five causes of emergency hospital admissions among children in England. The knock-on effect can be severe, particularly if children have to miss school through asthma attacks and frequent appointments with specialists. Without adequate support, asthma damages their life chances.
The postcode lottery also applies to people of all ages living in neighbouring areas. There is almost a threefold difference in admissions between adjacent PCTs. Afro-Caribbeans are twice as likely, and south Asians three times as likely, as white people to end up in hospital with an asthma attack, despite small differences in the rates of asthma within these communities. Outcomes are worse in poorer areas, with 86 per cent of spearhead PCTs having higher than average emergency admissions for asthma.
An asthma attack is a frightening and distressing experience, not only for the patient but also for their family. A person’s chances of accessing treatment good enough to put an end to the attack and keep them out of hospital should not depend largely on where they live. However, we should be optimistic about what, after improvements, the NHS could achieve through a sustained focus on asthma.
A survey showed that 20 per cent of nurses with lead responsibility for respiratory care have no accredited training in asthma. People with asthma say that the lack of specialist nurses affects quality of care. A national strategy could address this. Only a quarter of people with asthma say that they have a written personal asthma action plan setting out the treatment plan that they have agreed with their doctor and telling them when to seek help. As patients are four times more likely to have an emergency admission without one, these plans need to be part of a clear set of national standards. Anecdotal evidence suggests that asthma reviews, as required by the Quality and Outcomes Framework, often take place without basic checks on peak flow and inhaler technique. Indeed, some GPs do not know the correct way to use an inhaler. Clearly, a stronger focus is needed on getting asthma care right.
An acute NHS health trust report highlighted difficulties both in identifying patients who are frequently admitted with asthma attacks and in following people up after hospital admissions. Healthcare professionals with a special interest in asthma and respiratory conditions report that the clinical asthma guidelines developed by the British Thoracic Society are still not widely used. They also say that asthma-specific recommendations in the National Service Framework for Children, Young People and Maternity Services, published four years ago, are not being widely implemented. This may help to explain why asthma is still one of the top five causes of emergency admissions among children.
Although there is clear need for improvement, there are also some fantastic initiatives that could make a huge difference if there was a national strategy to replicate them elsewhere. Following funding provided by Asthma UK, Liverpool PCT, which has the highest admissions for asthma in England, is developing a whole-systems approach involving all the relevant organisations, including the PCT, the local authority and the local education authority, to improve standards and quality of care for people with asthma. The approach aims to empower both people with asthma and healthcare professionals to manage asthma effectively and improve the quality of services provided, with the overall aim of reducing emergency hospital admissions for asthma in Liverpool. Neighbouring PCTs in Oldham and Knowsley have recently joined in this major initiative in the north-west of England.
It costs three and a half times as much to treat someone who has an asthma attack as it does to care for someone whose asthma is well managed. That is important. Surely the money wasted on preventable emergency admissions would be better spent getting asthma management right, quite apart from the distress to patients and their families, which can and should be avoided.
Despite all the problems that I have spoken about today, I remain optimistic that we can drive up standards of asthma management to the level of the very best. Huge gains can be made, but that will happen only if the NHS makes asthma a sustained priority. This focus must include a national clinical strategy for asthma to drive up standards of asthma care, rather than the current patchwork of poorly implemented standards and guidelines.
Department of Health officials are currently finalising a national clinical strategy for chronic obstructive pulmonary disease, which will include initiatives that an asthma strategy could build on. At the same time, Scotland, Wales and Northern Ireland all have or are developing national asthma strategies and frameworks that could inform such a strategy in England, the only country without one. I urge Ministers to seize the opportunity that these developments represent to construct a national clinical strategy for asthma.
I thank the noble Viscount, Lord Simon, for bringing the problems of asthma to our attention again. I have probably never heard a more dramatic introduction to a short debate in my many years in your Lordships’ House. As a sufferer of asthma from a variety of causes—perfume is probably the worst to him—he must be admired for the normality of his life and for his tireless campaigning for fellow asthmatics.
I was privileged to sit with the noble Viscount on the Science and Technology Committee when we produced the report on allergy, which was published just over a year ago and debated in this House on 8 May this year. The report was useful and the Government’s response has been encouraging, but the required action needs more time and more money.
I shall not repeat too many figures, but they are important. About 20 million children and adults in the UK suffer from a form of allergy. More than 5 million of them have asthma, of which 1.1 million are children. Between April 2006 and March 2007, there were 67,077 emergency hospital admissions for people experiencing an asthma attack, 40 per cent of whom were children under 15. A simple allergy can be an early step on the allergic march towards much more serious allergies. The critical impact of allergy on health and the quality of life and its potential to cause fatalities, usually in older children and adolescents, should not be ignored. The prospects of unexpected allergic catastrophe or anaphylactic death are real for many families and should not be underestimated.
Good health and the ability to fight off disease are a function of the immune system. We read references daily to how that can be improved. It has been suggested that pregnant women who lead a sedentary lifestyle increase the risk of asthma for their children. Recent studies have shown that levels of vitamin D, which is found in food such as oily fish and is boosted by natural sunlight, can influence the development of a child’s lungs and immune system while in the womb. There is increasing evidence that an infection with gut parasites may protect against asthma and allergy. A recent study, funded by Asthma UK, showed that children born to mothers who had a low intake of vitamin E during pregnancy were five times more likely to have asthma than children whose mothers had eaten a diet high in vitamin E. There is also a possible link between asthma and obesity. The number of people with both problems has soared in recent decades. There are many more possible links between asthma, diet, rubbish collection and storage, pets, environmental issues, pollution and regional variations; I would need a whole hour to myself to cover them all, but they all carry an increased risk to the respiratory system.
In 2007, a person was admitted to hospital every eight minutes because of their asthma. A possibly defective gene has been blamed. Scientists have identified a cold-fighting protein that asthmatics lack. The common cold triggers about 85 per cent of asthma attacks in children and 60 per cent of those in adults. We need accurate data, so I repeat the Science and Technology Committee’s recommendation to the Department of Health, which was that the systemised nomenclature of medicine system, supported by appropriate training, should ensure efficacy as a simple, consistent classification system to record allergic disease, monitor its prevalence and inform the commissioning of allergic services.
Patients and the public should be better informed about allergy and allergic asthma. The ability to make an accurate diagnosis should be improved and there should be better, more specialised training for healthcare professionals. Poor knowledge of allergic conditions stems from the lack of an integrated and holistic approach to treatments. People with multiple allergies tend to see multiple specialists for multiple treatments, rather than a single allergy specialist.
There is a clear need for more research into the causes of allergy and asthma and into the clinical effectiveness of different forms of treatment. Work is proceeding on the definition of susceptibility genes for asthma and related phenotypes by positioning cloning approaches and recognising that pharmacogenetic approaches may be beneficial in managing patients. More diagnostic testing is needed, and services in both primary and secondary care should be improved. Only then will people with asthma and allergic conditions get the treatment that they need. I hope that the noble Viscount keeps up the good work.
One of the most courageous children I have ever known, for whom I had responsibility for a short while, had serious asthma. He was in this country from Germany with me. He longed for a normal life and he did everything that he could to have one. I longed for access to specialist care and the certainty that I could reach it if he had an attack. There were no specialists where we were and the GP did not have specialist knowledge.
One priority is to ensure that people have the name of a GP who specialises in asthma care. I think that only 13 per cent of people have the comfort of knowing that that is available. A survey has shown that 20 per cent of asthma nurses, who are expected to diagnose asthma and to give follow-up treatment without medical input, have not had accredited training. People with asthma have told us that the recent decline in the number of specialist asthma nurses has affected the quality of care that they receive. This is at a time when the number of people suffering from asthma is increasing rapidly. I hope that the Government will do something to make this a priority in the very near future.
I thank the noble Viscount for securing the debate and congratulate him on timing an asthma attack so perfectly that we really need say no more. I hope that he feels well now, but I begin to wonder about my presence in the Chamber and that of the noble Earl, Lord Howe, and the noble Baroness, Lady Thornton. Whenever we are together, someone seems to have a medical emergency. Perhaps we should talk about this at some time.
When I was a child, the only I person I knew who had asthma was my best friend. Every winter, I spent many weeks sitting by her bedside, rather as I sat by the noble Viscount a few minutes ago, watching her struggle for breath after contracting a cold that had precipitated her asthma. We spent many hours playing board games in her bedroom. I have to say that that was when we were not in my bedroom playing board games, because I was confined to bed with recurrent ear infections following colds. We both suffered, but I do not think that anything was quite as bad as asthma. I am well aware of what it must be like.
We have all seen the increase in asthma. In my childhood, my friend was the only person I knew who had bad asthma, but among my children’s generation there seemed to be huge numbers of children with asthma. On holiday in Spain as a teenager, one of my daughter’s friends died in an asthma attack because she could not get to a hospital in time. That was not very long ago.
Nowadays, as we have heard from the noble Lord, Lord Colwyn, schoolteachers seem to have many children with asthma in each class. They are well aware of it. Asthma has certainly been on the increase: we are told that there are now two or three times as many sufferers as there were 50 years ago. No one is really sure of the reason for that, although the noble Lord, Lord Colwyn, dealt with those aspects very adequately. It was interesting to hear him speak.
The smoking ban will help, as air pollution was always a factor. When I was a junior doctor and a GP, the fashionable thinking was that asthma was due to house mites. The increase in the number of cases of asthma has flattened recently and I wonder whether that is linked to the fashion for wooden floors as opposed to thick carpets. That may have contributed to the flattening of the graph for asthma.
Some 4.5 million people in this country have asthma, which is a lot of people. It is one of the most common long-term conditions that doctors and nurses have to deal with. Ten per cent of those 4.5 million people have very severe difficulties and very bad asthma. People may have seen the Royal College of Physicians survey, which says that 69 per cent of people with asthma do not have their symptoms under proper control. Some 38 per cent reported difficulty sleeping in the past month and 33 per cent reported interference with their usual activities in the past month. It is a serious, life-disrupting disease, with which people must live all their lives.
There were 1,199 deaths from asthma in 2006. That is more than the number of deaths from cervical cancer and testicular cancer combined. There have been many initiatives and a lot of publicity about cervical cancer and we are fortunate that the Government have made great strides and that the health service is doing a lot about it, but there are more deaths from asthma. It is a huge cost to the NHS in work and money—an estimated £16 billion a year and over 65,000 hospital admissions a year.
As we heard from the noble Viscount, people from the worst areas of Liverpool are more likely to go into hospital than are people in my former constituency of Richmond, which in some table or other once was regarded as the most highly educated and most well-off constituency in England. The reason why people there have better control of asthma is probably that patients’ parents and relatives and the patients themselves are so much more demanding and expect so much more in preventive care from clinicians.
What are some of the things that we should be doing to help those people? First, we need a personal action plan. It is terribly important that a doctor sits down with an asthmatic patient and works out what is going to happen to them and what they need. The noble Viscount clearly demonstrated that he has a personal action plan. He knows what to do and he does not need anyone to interfere. He knows that, if he does the right things, it will get better. Many people do not have that, but they need it. However, if that is to be the case, we will need many more specialist GPs and nurses in the community. Please, please can we have more training for doctors and nurses? In particular—the Minister will know about this because I am always beefing on about it—we need more community nurses who can deal with and have specialist training in long-term conditions. Asthma is one of them.
Every patient should have access to a personal care plan and to specialist GPs and nurses. They should be able to see a doctor who knows about the condition, whether or not that doctor is in their own practice. We also need a dedicated national strategic framework; every other country in the British Isles has one, but England does not. I know that things have been laid down on asthma in the children, young people and maternity services framework, but asthma is such a common long-term condition that it needs a strategic framework of its own. In some ways, it is great to have targets and frameworks, but the conditions that are left out get left behind, because PCTs and clinicians concentrate on the ones for which figures are collected. We must be very careful to ensure that asthma is not left out.
I have some questions for the Minister. What national initiatives are planned for the treatment of asthmatics? How will the Government deal with the postcode lottery that the noble Viscount mentioned, comparing Liverpool and Richmond, for example? When will we have a national strategic framework for asthma, together with training for doctors and nurses, so that people up and down the country, children and adults, can deal with their asthma, as has the noble Viscount this afternoon, and not have to be unnecessarily admitted to hospital?
The noble Viscount, Lord Simon, has done us a great service by tabling this debate on a subject of which, sadly for him, he has first-hand experience. I congratulate him on a trenchant speech. It highlighted the main problem with asthma as a chronic condition, which is that in current NHS priorities it still ranks relatively low in many areas, despite its high prevalence and the fact that it is responsible for a high level of hospital admissions and more than 1,000 deaths a year.
The rate of childhood asthma is higher in England than almost anywhere else in the world. We can and should draw attention to the prevalence statistics, but it is perhaps even more important to talk about the reality of living with asthma, which the noble Viscount was perhaps too stoical to refer to in any graphic detail, but which, as many of us will know from our families and friends, can be truly miserable and often an extremely frightening part of daily living.
Service provision is, I fear, a lottery; Asthma UK has published unequivocal data to demonstrate that. One of the main markers of that lottery is hospital admissions, where we see a vast disparity between different regions of the country, not least where it comes to children. The chances of a child being hospitalised for asthma as an emergency admission is more than twice as high in the north-west than it is in the east of England. In the east Midlands, on the other hand, the rate is 21 per cent below the average. Those disparities cannot simply be attributed to socio-economic factors; they must also reflect differences in service provision. Quite rightly, Asthma UK has been urging the Government and the NHS to do something about that.
Part of the problem—in fact, a major part, as the noble Viscount mentioned—is the absence of national standards. Without such standards, patients are missing out in a big way, but the NHS is also missing out on millions of pounds in potential savings. Asthma UK tells me that asthma-related emergency hospital admissions cost the NHS £61 million a year and that three-quarters of those admissions are avoidable. Even if it has exaggerated the scope for financial saving—I do not think that it has—we are still talking about tens of millions of pounds of unnecessary cost. Once someone has a serious asthma attack, the cost of looking after him is three and a half times more than if the attack had been prevented. As we have heard, there are 4.5 million people with asthma in England. More than two-thirds of asthmatics who were surveyed by Asthma UK said that their symptoms were not under control.
An NSF or national clinical strategy would benefit an awful lot of people. I understand that we are the only western or developed country that has nothing of that nature. The last that we heard in a Lords Parliamentary Answer was that an NSF was not even in development. Why is that? Wales, Scotland and Northern Ireland have their own guidelines and the British Thoracic Society has issued guidelines, so it should not be too big a step to produce a national clinical strategy for England.
As a start, we need to look at basic things such as personal asthma action plans. We know that where someone has one of those plans, setting out what treatment regime is appropriate to them and exactly when they should seek help, they are four times less likely to be admitted to hospital as an emergency case. However, as the noble Baroness, Lady Tonge, told us, only about a quarter of asthma patients have such a plan. The scope to improve asthma care is clearly considerable. It is clear that existing guidelines are just not doing the job.
There are particular difficulties with people who have severe asthma or asthma that is difficult to control. Acute trusts have told Asthma UK that they find it hard to identify patients who have been admitted to hospital on a frequent basis, which seems extraordinary. They also find it difficult to follow those people up after they have been to hospital.
I would be glad if the Minister could say something about specialist training in asthma for GPs and nurses. For many patients, access to an asthma specialist is difficult to achieve. Only 13 per cent of people with asthma have been offered the name of a GP specialising in asthma in their area. Asthma UK tells me that it is particularly concerned that many healthcare professionals who treat asthma have not had adequate training. The noble Baroness, Lady Greengross, referred to the 2006 study by Education for Health and Edinburgh University, which found that 20 per cent of asthma nurses have not had any accredited training. Again, that seems most surprising. On top of that, there has been a decline in their numbers, which, not surprisingly, patients say has affected the quality of care that they receive. That is also something that an NSF could address.
Last year, as we heard from my noble friend, your Lordships’ Science and Technology Committee reported on the topic of allergy. Its approach to the subject was a general one but it made a number of recommendations on issues that directly relate to asthma. One was that there should be at least one allergy centre led by a full-time allergy specialist in each strategic health authority. It would be the job of the allergy centre to diagnose a patient’s allergy and to develop a treatment plan. Once that had happened, the patient’s condition would be managed back in the primary care setting. In reply, the Government promised to consider establishing a lead SHA and, in August this year, the north-west was approved as the first SHA to have an allergy centre. That is good news, but will the Minister confirm that, provided that the centre proves its worth, we can expect more of the same in other parts of the country?
A number of the public health messages on asthma have a marked similarity to those on obesity. Of course, it is not uncommon for the two conditions to coexist in one individual. Taking exercise and eating plenty of fruit and vegetables both improve lung function. Smoking is a universally bad thing to do if you are asthmatic and if there are others in your house who suffer from asthma, especially children. For me, this is one of the big arguments in favour of banning smoking in public places. Smoking in the presence of a child or while pregnant increases the chances of the child developing asthma. The same applies to stress during pregnancy and allowing children to swim in chlorinated swimming pools. There is some tentative evidence that children should not be given paracetamol in the first year of life; it has been associated with a 46 per cent increase in the risk of asthma symptoms at age six to seven. We should be hearing more of those kinds of public health messages coming from the NHS. It should not only be Asthma UK that is left to promulgate them.
There can be some serious asthma hazards in the workplace. A whole range of respiratory sensitisers that can trigger asthma are found in a number of working environments. The Health and Safety Executive has been active in promoting good practice in factories and other places of work but, as my noble friend said, the key to the successful management of asthma, as with any chronic condition, is the informed patient.
I read an article in the Lancet the other day that set out three unanswered questions about asthma. What is asthma? Who gets asthma and why? Which factors enable us to predict how badly you will get asthma and how you will react to treatment? Those questions are more or less the only ones that matter. Beyond a certain very basic point, we do not know the answers. A good deal of research is going on in the UK and internationally to try to get closer to those issues, but we surely need to do more. We are still a long way from being able to prevent asthma and just as far away from being able to cure it. How can we better identify patients at an early stage who are at risk of a disease progression? On some of the specifics, can we do a randomised controlled trial to test the hypothesis of a link between paracetamol and asthma, or between eating nuts during pregnancy and giving birth to a child who becomes asthmatic? Can any sort of finger be pointed at domestic cleaning products?
I wonder, incidentally, whether the Minister has seen recent reports in the press that appear to cast suspicion on the triple inoculation against diphtheria, tetanus and whooping cough as being a trigger for childhood asthma. It appears that researchers at the Manitoba Institute of Child Health found that, if the initial dose of the jab is delayed to when a child is at least four months old, the chance of the child developing asthma by the age of seven is less than half what it would be otherwise. That is a pretty dramatic finding. It would be helpful if the Minister could say whether the department is looking at it. The UK has the highest prevalence of asthma in children aged 13 and 14 in the world. We need to establish why that is. If the DTP inoculation looks as though it might be a contributory factor, I suggest that we need to confront the data head on.
In general, progress in understanding asthma and how it works is slow. We cannot, and should not, be satisfied with that against the backdrop of facts and figures that the noble Viscount has cited. I hope that the Minister’s reply will give us a sense of how importantly asthma is taken by the Government, in terms of service delivery as well as research, and that we can leave this debate with at least some measure of encouragement.
I am grateful to my noble friend Lord Simon for securing today’s debate on this important condition. He knows that I have great admiration for his contribution to your Lordships’ House and particularly for the way in which he manages a difficult condition. A lesser man might regard it as a reason for taking it easy, but not my noble friend. As he pointed out—and demonstrated—asthma is a common condition, but no less serious for that. It affects the day-to-day choices of those who suffer from it and, by association, their families.
I am pleased to report that the prevalence of asthma has started to plateau, after decades of increase. There has been a fall in death rates and hospitalisations due to asthma, although clearly, as many noble Lords, including the noble Earl, pointed out, there is a great deal more to do. We want to ensure that the improvements that have led to that situation continue.
A lot of the credit for this must go to healthcare professionals for implementing and working to evidence-based guidelines and to organisations such as Asthma UK and the British Lung Foundation for working as true partners of the NHS by providing information and tools to help people better to manage their condition, as mentioned by several noble Lords. We are supporting improvements in understanding asthma, its causes and how it should be treated by investing in research, as the noble Earl mentioned. He rightly listed the obvious questions. For example, we have invested £4.75 million over five years in the Biomedical Research Centre at Guy’s and St Thomas’s to work on a range of aspects of asthma, including treatment for chronic asthma and prevention.
Research by the National Primary Care Research and Development Centre in November 2006 found that GPs in the UK are leading the world in the efficient management of chronic disease, the use of information technology and the uptake of financial incentives to improve the quality of services.
The Quality and Outcomes Framework for primary care has certainly helped to drive up performance in asthma care. Asthma UK’s independent review, to which several noble Lords have referred, has shown the dramatic impact of good-performing primary care practices on reducing hospital admissions and deaths. We are keen that those lessons should be learnt and that those practices should become more widespread.
A number of new developments will have an impact on the provision of services to people with asthma. I say to the noble Baroness, Lady Tonge, that the Department of Health has been leading the development of a breathlessness pathway for primary care trusts. Its main purpose is to set out the commissioning requirements for primary assessment of the patient through specialist and sub-specialist care, inclusive of diagnostic investigations, treatment interventions and follow-up arrangements for improving the care of people with breathlessness resulting from obstructive lung disease, including asthma. We hope to publish the pathway before the end of the year. I think that that is health service code for what the noble Baroness was referring to as regards patients needing to have a personal pathway available to them.
How will PCTs be assessed on how they implement those pathways in their areas?
I hope that I will come to that. We have also been developing a national strategy to improve the care and management of chronic obstructive pulmonary disease. We aim to publish this early next year. The strategy will include raising awareness of good lung health, accurate and early diagnosis, the proactive management of patients and the development of respiratory networks at both the national and the local levels. As we develop the strategy, we will be keen to highlight the areas in which lung health can be improved and specifically where improvement can be made to other respiratory conditions, particularly asthma. Officials are meeting the chief executive of Asthma UK shortly to discuss this further.
The other key to the management of asthma is appropriate support for those in the community. This approach to the management of all long-term conditions was reaffirmed in High Quality Care for All, the recent review of the NHS carried out by my noble friend Lord Darzi. The review makes a commitment to ensure that practitioners have the necessary skills to provide effective care. For those professionals working in the field of asthma, this will build on the excellent programmes run for many years by the National Respiratory Training Centre. High Quality Care for All also sets out ambitious plans to offer personalised care plans to everyone with a long-term condition and to drive improvements in both primary and community-based services. These ambitions have been reflected in local plans developed in every strategic health authority in England.
We think that the best way for service providers to achieve the proactive management of long-term conditions such as asthma is through personalised, tailored packages of care with more regular review. To support this, we have developed disease management information toolkits to inform decision-making at both the regional and the local levels. The use of the toolkits helps to build up intelligence across health and social care by providing key data and guidance for every primary care trust in England. The toolkits support decision-makers, commissioners and front-line providers in gaining a better understanding of those long-term conditions that are having the greatest impact on local health populations in terms of the use of emergency day beds and other healthcare resources.
We know that self-care is absolutely vital, as several noble Lords said. Asthma was one of the first conditions to be included in the NHS Choices series of guides. The guides focus on advice about lifestyle, information about conditions and the treatments for them, and advice and support on living with a condition. In addition, we are making further investment in the Expert Patients programme to increase the capacity of course places available to offer patients from 12,000 to 100,000 a year by 2012.
On the specific questions raised by noble Lords, the noble Viscount, Lord Simon, and the noble Baroness, Lady Tonge, both mentioned the importance of dealing with children with asthma. In September 2004, the National Service Framework for Children, Young People and Maternity Services publication included an exemplar patient journey on asthma, which I know Asthma UK has made a priority. I did some work with this organisation many years ago and indeed we were addressing the issue when I was talking to its representatives about how to get this into the hands of every teacher in the country. I am glad to see that progress has been made, because the patient journey on asthma in childhood exemplar forms part of the framework and its implementation is key.
The noble Baroness, Lady Tonge, the noble Viscount, Lord Simon, and others mentioned a national framework. Following on from the NHS next-stage review, the Department of Health is developing the COPD clinical strategy with NICE. The COPD programme board is considering including a chapter on asthma in the clinical strategy. We will meet Asthma UK soon to talk about what can be done on asthma in the COPD strategy. My noble friend Lord Darzi’s report High Quality Care for All recommended the setting-up of a national quality board, the responsibilities of which would include deciding priorities for new work in the future on specific clinical conditions. We expect to consider the case for an asthma strategy over other candidates.
The noble Lord, Lord Colwyn, and others raised the issue of health professionals being trained in the treatment of asthma. We will introduce modularised—a terrible word—accredited training packages and we will strengthen educational governance to ensure that all clinical staff have the opportunity to develop their skills throughout their careers. We regard asthma and chronic conditions as an important part of that.
The noble Lord, Lord Colwyn, and the noble Earl, Lord Howe, both mentioned allergies and allergic disease. The research at Guy’s and St Thomas’s will focus on a prevention that includes allergic aspects. Diagnostic investigation to support that focus, including allergic aspects, is outlined in the 18-week breathlessness pathway, which includes specialist bronchial challenge tests and a pathway test for immune function. The north-west SHA is taking forward this work in looking at improving allergy services, as has been mentioned.
The noble Lord, Lord Colwyn, asked how we record asthma admissions to make it easier to monitor them. We record asthma admissions and finished consultant episodes associated with asthma in the hospital episode statistics, which are provided at all levels. The noble Baroness, Lady Tonge, mentioned the training of nurses in the community. In addition to the proposals outlined in A High Quality Workforce for all health professionals, Modernising Nursing Careers focuses on developing fit-for-purpose education on long-term conditions.
I shall deal with the other questions in writing, as I am conscious that my time is nearly up. Should we be worried about inoculating young babies with the DTP vaccine? We urge parents not to leave their children vulnerable to those serious illnesses because of an unproven claim that there is an extra risk. There is no substantive evidence, as far as the department is concerned, that the DTP inoculation puts babies at greater risk of asthma.
I say to the noble Baroness, Lady Tonge, that an assessment will need to be designed by the Care Quality Commission as part of the development of the independent performance assessment of providers and the effectiveness of PCT commissioning. We are quite familiar with that, as I recall.
I thank noble Lords for the many points that they have raised. There is no doubt that long-term conditions such as asthma present a massive challenge to health and social care, as well as to families and communities. I assure noble Lords that we will continue to support and encourage the NHS to ensure that people with asthma receive the care that they deserve.
[The Sitting was suspended from 3.53 to 4 pm.]
asked Her Majesty’s Government what is their assessment of the effectiveness of international financial institutions such as the International Monetary Fund and the World Bank.
The noble Lord said: At the conclusion of the Bretton Woods conference in 1944, to universal applause, John Maynard Keynes paid tribute to his colleagues, who he said had performed a task appropriate,
“to the prophet and the soothsayer”.
I often speak of the wealth of talent and experience that exists in your Lordships’ House; however, I do not think that any of us today, in the limited time offered to us, will be claiming the title of “prophet” or “soothsayer”. What we can do, however, is look at the financial crisis that is upon us and ask what has happened, why it has happened and what must be done so that it does not happen again.
As many of your Lordships know, I have had this debate in the ballot for a number of months. Not only am I delighted that it is taking place at such an important and appropriate time, but I am grateful to those Peers speaking in the debate today, many of whom are recognised as world experts in this field. I welcome the Minister to this House. I congratulate him on his appointment, and we look forward to his response at the end of the debate.
If recent events have taught us anything, it is that the global institutions set up after the Second World War, such as the UN, the IMF and the World Bank, so appropriately created for that time, are now so out of step with our time. As reported in the Times, there are three kinds of organisations: those that make things happen, those that watch things happen and those that wonder what happened.
Take the IMF, an organisation of over 2,700 employees, with access to resources in excess of $363 billion. With all those resources, where was the IMF last year when this crisis started to unfold? Where were the IMF’s warnings as the world sleepwalked into financial meltdown? And today, when we are in the grip of the crisis, where are the IMF’s proposals on how to end it? The question we have to ask ourselves is: if the IMF is not mandated to fulfil that important function, why not? To its credit, the IMF’s 2007 Global Financial Stability Report in fact recognised that the US housing market was slowing down. However, it said that,
“this weakness has been contained to certain portions of the subprime market ... and is not likely to pose a serious systemic threat”.
Ironically, the stress tests that formed the IMF's evidence base for this report were produced by none other than Lehman Brothers.
A core function of the IMF is to act as the lender of last resort, but even there we have seen that it is not the lender of first choice. Take the Asian crisis of 1997, when South Korea ignored the advice of the IMF and came out the better for it. Today Iceland and Pakistan, for example, have both turned elsewhere first before approaching the IMF.
I want to make it clear that this is not a blame game. It is about finding a new mechanism that will enable the global community to work together. I heard President Clinton say that, whereas countries have historically always been interdependent on one another, today countries are integrated with one another. We have all heard the saying that when America sneezes, the world catches a cold; we can now see that we all catch that cold the very same day. Today we see the Indian stock market anticipating the actions of the US Secretary of the Treasury before they have been announced. Today we see India, a country still without a fully convertible currency, having to react swiftly to the challenges and opportunities presented by our integrated global economy.
The balance of economic power in the world is changing dramatically. The US, the European Union and Japan together contribute approximately 60 per cent of global GDP, and yet emerging countries with large surpluses are today investing huge sums of money in developed countries. These rising stars of the world economy need to be better integrated and represented in our global financial institutions. In short, the world’s top table needs to change—it needs more seats.
The world is returning to where it was some three centuries ago, with India and China once again set to emerge as the two dominant economic superpowers. Yet neither country has a place in the G7 or the G8, and India remains excluded to this day as a permanent member of the UN Security Council. The chairmanship of the World Bank remains the gift of the President of the United States. For what reason? That America was once the bank’s biggest funder by far. Today, however, it is just one of many. If the World Bank is to be for the world, surely its governance should reflect today’s economic reality, not yesterday’s. Similarly, does the managing director of the IMF need always to be European? Why not an American? Why not an Indian? Why not the best candidate for the job?
There is no question but that America is by far the most powerful country in the world today, but, looking ahead just 20 years from now, when China and India are economic superpowers alongside the EU and America, will it, for example, seem appropriate for the headquarters of the IMF, the World Bank and the UN to all be located in one country?
Contrary to recent events, we should be proactive, not reactive, and look at what is right for the world as it is today and as it will be tomorrow, whether that be a reformed World Bank—by the world, of the world, for the world—or a reformed IMF that would be genuinely global in its funding and in its scope, acting as an economic firefighter but, more importantly, as the steward and guardian of the global financial system. We need a mechanism for global financial institutions that can promote free trade without hampering free trade. We need regulation that is neither light-touch nor heavy-handed but balanced to protect consumers globally; to promote transparency; to prevent; to predict; to lead by example; and to argue forcefully that trade is not a zero-sum game.
The Brookings Institution said earlier this month:
“Public institutions need to be the vehicles by which leaders take public responsibility for the public interest … The International Monetary Fund is in the doldrums, waiting for a new global mandate in the midst of a serious global financial crisis. Member governments have failed to act to give the IMF a role in co-ordinating national responses and institutional innovations to help remedy this financial crisis or prevent the next one”.
Today it is Britain that has shown leadership in the international community through the announcement of its £500 billion rescue package for its financial sector, a sum that dwarfs America’s $700 billion package even at today’s exchange rates, and America’s economy is more than six times larger than Britain’s. In advance of the meeting of world leaders on 15 November, I urge the British Government to follow in the tradition of Keynes at Bretton Woods and to lead the way with boldness, confidence and authority in reforming our global financial institutions. Over 60 years ago those institutions were born out of the Second World War. Now they need to be reborn out of the global financial crisis as institutions that are fit for purpose for today and for tomorrow.
We are all grateful to the noble Lord, Lord Bilimoria, for initiating the debate. He has said much with which I agree entirely, so I shall confine myself to what I can add to the debate. First, when President Nixon announced on 15 August 1971 that America would shrug off its role as a key currency in selling gold at $35 an ounce, the IMF died. It should have been given a decent burial immediately because it had no function to perform once the particular combination of a world of capital controls and fixed exchange rates was gone. It had been a vision created by John Maynard Keynes in Bretton Woods. It served its purpose extremely well between 1945 and 1971, but in subsequent meetings that had to decide on a regime of flexibility in rates, noble Lords will recall that it was individual countries themselves that took the initiative to fix, in a series of meetings, what the system of flexibility in rates would be, while Europe took a lead and set up the European Monetary System, and so on.
The IMF completely missed the petrodollar crisis, let the third world get into unsustainable debt, and in 1981 started bullying everyone about their macroeconomic balances. The IMF had the wrong macroeconomic model for developing countries and ruined many of them. Indeed, it performed a signally negative role throughout the 1980s and 1990s. Today the IMF is a moderately good macroeconomic forecasting body, somewhat like the National Institute of Economic and Social Research, although it is not quite as good. I suggest that we should abolish the IMF at the first opportunity and merge its macroeconomic forecasting unit with either the World Bank or the Bank for International Settlements, which is a glorious institution when compared with any of the others. One can be absolutely bloody-minded about the IMF, and I agree strongly with the noble Lord, Lord Bilimoria, that it did not do anything in either the current or any previous crises. Indeed, last March I was taking part in a BBC programme while the IMF was holding its spring meeting. I then managed to roundly abuse the institution and say that it should be abolished, so I am not saying anything on the spur of the moment.
Institutions that have outlived the function for which they were set up should be abolished forthwith, not reformed. There may be a need for an institution at the international level, but the first question to ask is this: what is the gap in the market that the institution is supposed to fill? If we have complete flexibility in rates and if, despite the financial crisis, we have good capital flows, what is the market failure that an institution designed like the IMF is supposed to correct? Indeed, would it not be better for countries in balance of payments difficulties to go to a consortium of private banks that would be less bullying and authoritarian than the IMF? The IMF sets conditions which a country receiving its help has to accept. What is most absurd is that the IMF makes countries request that it imposes conditions on them so it looks like it is not the IMF but the country itself that is asking to be whipped, put in chains and messed about.
I also concur with the noble Lord, Lord Bilimoria, about the governance of the IMF and the World Bank, and I do not want to add anything to what he said. Even the permanent secretaryship of the UN should be advertised and the best person elected, rather than let it be a case of Buggins’s turn, which is what we have. That sort of business almost always leads to a second-rate person being appointed.
I want to make one more point about the World Bank. Over the years it has improved a great deal, and to the extent that the IMF has performed functions related to aiding the third world, those activities should go to the World Bank. We also need to think more broadly about the functions performed by the World Bank. While there is need for such aid flows, we must ensure that they are given to where they are most needed and are not wasted on a number of rather peculiar experiments, especially, say, the dams experiment in which the World Bank got involved.
It is always a challenge to follow the noble Lord, Lord Desai, but when he came to abolishing institutions, it seemed to me that the house is on fire and that we should not pour petrol on the flames.
The philosopher Nietzsche wrote that there are no such things as truths, only interpretations. Nietzsche was quite a problem to himself, but he has left us with this valuable insight.
Interpretations vary from yet another valuable insight to frankly partisan spin. How do we tease out the Government’s interpretation of their assessment of the IMF? I shall refer to two short sentences in the Prime Minister’s Statement on the European Council meetings. On the rebuilding of confidence, given the Prime Minister’s view that as the crisis started in America, America is responsible, any interpretation of Northern Rock is left high and dry. The first sentence refers to,
“a new international architecture for the global financial sector”.
The second sentence refers to,
“reform of the International Monetary Fund and Financial Stability Forum, including the creation of an early warning system for the global economy”.—[Official Report, Commons, 20/10/08; col. 22.]
How does the noble Lord interpret “a new international architecture”? Is the whole of Bretton Woods to be felled? As we follow once again in the revolutionary footsteps of Tom Paine, what will be built and when? We have no time for this fantasy when what we need, and encouragingly are seeing, is daily IMF action—for example, Iceland, Hungary, Ukraine and Pakistan. Where next? This architecture sentence is firmly in the category of “spin”. What is the Government’s interpretation?
The second sentence is more interesting. Three points need consideration. First, we need to consider reform of the IMF, which is 64 years old with 185 members, 10 of whom have 55 per cent of the votes. With 11 years’ experience, the Prime Minister will be sitting on many a memorandum entitled something like “Proposals for the reform of the IMF”. Have any been published? I could not find one on the Treasury website.
Now I part company with the noble Lord, Lord Bilimoria, to whom we are all grateful this afternoon. The IMF has understandably long found it risky to give hard advice to the 10—55 per cent—members. Indeed, everyone finds it risky to give the Prime Minister hard advice. The fund has frequently been reminded that many identify the onset of irrelevance. When and if it has run scared, that has not been surprising. That is not so now when such critics are repenting or at least spinning their willingness to claim that they have always been determined supporters given unspecified reforms. However, the most recent IMF financial stability assessment of the UK was in 2003 and the United States will not have one.
The reform of the Financial Stability Forum is an entirely different matter, although it appears in the same sentence. The FSF is nine years old. It is housed in the Bank for International Settlements with a seconded secretariat of seven. There is no structure, no professional staff or any legal status. As no threat to G7 leaders, or to their bureaucracies, it is a comfortable partner. How is it to be reformed? It is not an international institution as it is.
Finally, the early warning system is already the delegated responsibility of the IMF, but who paid due attention to the April 2007 global financial stability report—perhaps punches were pulled, as the noble Lord, Lord Bilimoria, suggested, but they were running scared of the bullies—or to the April 2008 report, which was closer to the mark than any rich-country Government? How do the Government assess the IMF—as an interesting institution but not much use until reformed, or as an important and professional contributor to the solution of today’s crisis? What is the answer?
I, too, am grateful to the noble Lord, Lord Bilimoria, for initiating this debate on international financial institutions in the middle of the biggest financial meltdown since the war.
I shall concentrate my brief remarks on the IMF. Unlike the noble Lord, Lord Desai, with whom I rarely disagree, I do not want to abolish the IMF—his suggestion that distressed borrowers come to private banks for loans is a remarkable expression of confidence in the private banking system at this moment of its performance—I want to reform it.
My reform would be based on reminding us of what it stood for: to promote a stable system of exchange rates by preventing countries from manipulating their currencies to get unfair trade advantages. Various things went with that: the commission to devalue in exceptional circumstances, short-term loans, temporary balance-of-payments difficulties, and allowing countries to prohibit imports of goods through something which the noble Lord will know about but I do not know how many others do—the never used scarce-currency clause. All this was designed to prevent the development of global imbalances of the kind that we have seen recently. It did not work out that way, however, because creditor countries such as Germany and France in the first phase of the Bretton Woods system found it more convenient to increase their dollar reserves than to revalue their currencies, and the United States could run increasing balance-of-trade deficits by printing Treasury bills.
The whole system fell down in 1971, and the main purpose of the IMF’s requirement to preserve stable currencies was abolished in 1978. As we have just been told, we were on a non-system of flexible exchange rates, but this did not solve the problem of global imbalances, as it was supposed to. Since the 1980s, the problem has re-emerged in spades. China and the Far East now hold US Treasury bills in large quantities, which the United States pays out to finance its huge current account deficits of $500 billion a year, on average, for the past four or five years. This is called the savings glut in Asia, the counterpart of which is the consumption glut in the United States.
Exchange undervaluation by Asian countries has been a deliberate policy to carry out both the accumulation of reserves and their export drives. This is where we come to the connection between this world situation and our current financial crisis, because these excess Asian savings have been shovelled into the housing bubbles of both America and Britain: not directly, of course, but by enabling our Governments to pursue expansionary, monetary and fiscal policies that fuelled an unsustainable credit and housing boom. That has contributed directly to the current financial collapse.
For the past 10 years, America has in effect had no budget constraint. What is true of a country was true of lots of individuals, who piled up personal debt on the back of constantly inflating house and asset prices. The IMF, as the noble Lord, Lord Bilimoria, rightly said and as the noble Lord, Lord Desai, reiterated, has been completely marginalised in this process, because it has lost its central purpose: to prevent these huge imbalances from occurring in the first place. Any reform of the IMF must therefore start with seeing how we might reform the international payments system in order to promote a balance-of-payments adjustment. It seems obvious to me.
The clear first step is to attack the Asian fetish of building up huge reserves for crisis insurance. The best way to do that is to activate the IMF's power to create international fiat money by means of special drawing rights. The quantity of extra reserves would have to be very high, but we have been used to talking of hundreds of billions of dollars, and a few hundred billion more will not alarm us that much.
Secondly, we must find some method to prevent the pile-up of large creditor balances and their counterpart of persisting debtor balances. In other words, we need to revisit the whole question of exchange rate adjustment. A well known suggestion by the economist John Williamson is that the major countries should agree periodically on reference exchange rates which they intervene to push market exchange rates towards. That is a complicated suggestion, but it begins to address the problem of how we can keep our exchange rates more stable and prevent global imbalances building up. That would be a desirable new project for a Bretton Woods conference. We will come to that in the end. When we do, we should hold it at the Mount Washington Hotel in Bretton Woods, New Hampshire, where Keynes and Harry Dextor White hammered out the original Bretton Woods system that served the world so well for 30 years.
I, too, begin by thanking the noble Lord, Lord Bilimoria, for securing this debate and for introducing it with the insight and eloquence that we have come to expect from him.
We all agree that there is a need for a genuine and radical reform in the world's financial architecture. There is no shortage of suggestions. The question that we should ask is: what are the principles that should guide how a new financial architecture should be set? Those principles, in turn, will be determined by the goal and objective that we want the institutions to realise. Is the reform intended to stabilise capitalism? Is it intended to save capitalism from the folly and mischief of capitalists? Is it intended to perpetuate existing global inequalities? What is our goal?
There should be widespread consensus that our goal should be to create a just world in which globalisation works to the advantage of all. If that is our goal, certain principles follow from it. We should evaluate in the light of those principles whatever suggestions are offered. First, the institutions should increase our capacity to control the impersonal forces of the market and allow us to shape our economic destiny, rather than be governed by it. Secondly, the institutions should promote global well-being, as articulated, for example, in the millennium development goals, such as reduction in poverty, disease, hunger, and economic underdevelopment in general. Thirdly, the institutions should ensure democratic participation, so that all voices are heard and all legitimate interests are taken into account. The fourth and equally important principle that should guide our decision is that the institutions to be set up should be transparent and accountable.
If we judge by those four criteria, which are crucial, the existing institutions turn out to be extremely disappointing. For example, in the IMF, developed countries have 72 per cent of the votes, whereas Africa has only 5.6 per cent, Asia 10.4 per cent and Latin America 7.7 per cent. As the noble Lord, Lord Bilimoria, pointed out, the managing director of the IMF is by convention European and the president of the World Bank is American. Those posts are not advertised; they do not even necessarily go to the best people; they are political gifts. The mischief that that can cause we have seen over the years.
Those institutions have served the interests of developed societies rather than the rest of the world. The noble Lord, Lord Desai, rightly talked about the mischief that the IMF pursuing Washington consensus caused under Paul Wolfowitz. The IMF posed a neo-conservative agenda and gave money to those regimes of which it approved. In the 1990s, the IMF unleashed klepto-capitalism in the Soviet Union and its associates.
The question is that if all these institutions are inadequate, what should we be doing? I want to end with four or five suggestions that I think are quite important. First, the posts of managing director of the IMF and president of the World Bank should be widely advertised and open to all, as is that of the secretary-general of the United Nations. I am even tempted to suggest, given that the World Bank is intended to help poor countries, that the president must always come from one of the low-income or developing nations.
Secondly, the composition of the IMF and the World Bank should be adequately representative of all parts of the world. All kinds of criteria have been advocated and I shall not go into them for lack of time, but population, deposits, need and volatility of an economy are all criteria that can be taken into account. Thirdly, the policies followed by the IMF and the World Bank should be publicly debated and endorsed, and therefore both could do with a globally representative advisory committee. There should be a way to provide for regular consultation with those countries which have to turn to these institutions for help and consultation on their management.
Fourthly, an imaginative way must be found to increase the funds that are available to the IMF and the World Bank. It is extraordinary that the IMF is going to have to depend on China for funds when that country has no effective say in the running of the fund. Imaginative ways of raising funds might be by raising taxes on global commons or a version of the Tobin tax. Finally, we must think in terms of regulated mechanisms to monitor cross-border capital flows, to keep an eye on the lending practices of the big banks and in general to ensure the confidence of the international financial institutions.
If we think along these lines, perhaps a new version of the IMF rather than the institution as it is currently structured could take on these functions.
I congratulate my noble friend on raising the issue of IFIs, which have had too little attention in Parliament. I have tried to understand the present crisis through the prism of the needs of developing countries which inevitably are going to be the worst casualties. In Beijing the UN Secretary-General warned that the crisis could be the last straw for the world’s poorest:
“It threatens to undermine all our achievements and all our progress”.
The president of the African Development Bank, Dr Donald Kaberuka, recently expressed similar concerns and said last week that on present trends, Africa can no longer reach the millennium development goals. Some 17 million people face starvation in the Horn of Africa alone, only partly because of conflict. The situation is being aggravated by the wider economic climate. The IMF itself has warned that rising prices and inflation are already undermining the improvements made in economic and social stability in the third world over the past two decades. Inflation in sub-Saharan Africa is expected to reach 12 per cent by next year. The president of the World Bank has made food prices a particular concern, and our Government have responded positively.
I will not repeat the stories of poverty and hunger that have been reported in the press over the past few weeks, but leaders of developing countries are naturally pessimistic not just about the state of the world economy, but the ability of the Bretton Woods institutions to cope with it any longer. There is a vigorous network of NGOs with a good deal of expertise nowadays in the workings of the IFIs, and they are arguing for a stronger voice for these countries at World Bank and IMF meetings. Even the Group of 20 meeting in Washington next month will have only South Africa to represent the entire continent of Africa. That is why 556 NGOs, 60 of them in Africa, have called for a Bretton Woods II, a global summit genuinely representing all UN members. Decisions will still have to come from the G8 plus two or three, and parity between borrowers and non-borrowers would be difficult to achieve, but in today’s crisis with more developing countries becoming lenders, surely more account should be taken of them. Does the Minister agree that Africa should have a third seat at the World Bank, and will the UK support the case for wider third world representation?
More of the countries invited to Beijing should be included in IMF meetings. Incidentally, it was another Beijing summit two years ago which brought an African forum together and created a new momentum of Chinese aid and investment in Africa, which has caused considerable confusion in the western aid world. It becomes even more significant at a time when China has been asked to become one of the world’s bankers.
In contrast to its image, Africa has enjoyed spectacular economic growth of about 7 per cent over the past decade, and progress has been made in health and education, but that has occurred in spite of the restraints imposed by the IFIs, as outlined by the noble Lord, Lord Desai. No one should be in doubt about the low reputation of the IMF and the World Bank in Africa. That was dramatically portrayed in Abderrahmane Sissako’s 2006 film “Bamako”, when leaders of the two institutions were literally standing trial while Africans suffered from globalisation and harsh conditionality. What right, for example, did the IMF have to interfere in the details of wages of teachers in Malawi and Mozambique? The consequence, as recent research by ActionAid shows, is that untrained teachers are now being employed, lowering the quality of education. The IMF has not understood the principle of the poverty reduction strategy.
I know that my noble friend will join me in arguing that the IFIs should be much more accountable, and perhaps the Minister agrees with that. Can he forecast our position at the forthcoming finance meeting in Doha? That may be the first international meeting that represents the needs of the poorer world effectively. The Doha round must also be revived at all costs to rebalance world trade and recognise the legitimate demands of the LDCs. We have to look at the long term. The world must find a solution in which, as many economists since Keynes have argued and even more do today, fairer trade and steady social improvements in the poorest countries will in the end create a climate of economic stability for all of us.
Like other noble Lords, I congratulate the noble Lord, Lord Bilimoria, on securing this debate. I have contended for a long time that one of the reasons why the world global institutions perform so badly is that they are accountable to no one. National parliaments take very little interest in them on a sustained basis, and I hope that the trend that the noble Lord has started today will continue.
I shall concentrate on the IMF. In good economic times the IMF plays a relatively quiescent role. It has an ongoing surveillance function, of dubious success. One of the things I hope to pursue with the Minister on another occasion is the extent to which the IMF was looking at what was happening in Iceland earlier this year and the extent to which it was talking to its major member states about the inherent risks in that country. Surveillance is a job that someone needs to do; the IMF does it, but might do so a bit more robustly.
In times of currency crisis, however, the role of the IMF is much greater in helping stabilise increasingly unstable situations. In recent days we have seen countries from across the globe, from Pakistan to Iceland, lining up for IMF support. In some cases, at least, they are getting it. The criteria of the noble Lord, Lord Parekh, for the purpose of the IMF were noble, but a simplistic answer to the question, “Why do you need the IMF?” is, “Frankly, if we didn’t have one, at times like this we would have to invent it”.
It is clear that there are major challenges to the IMF if it is going to fulfil successfully the role that so many countries look to it to provide. Central to those is that the IMF and the World Bank have been seen, and have acted, as advocates for a particular economic doctrine, and have been seen to be very much under the sway of the US and, to a lesser extent, of the EU. Over the years they have been pushing concepts like privatisation and liberalisation that in theory might work but, in practice, do not work everywhere all the time.
In the excellent biography of Keynes by the noble Lord, Lord Skidelsky, he describes Bretton Woods in tremendous detail and explains that the Chinese delegation, which I believe was quite small, suffered the disadvantage of not speaking a word of English, and because the whole thing had been done at short notice there were no translators. At the time, no one seemed to mind very much; the role of China was relative small and it did not really matter. It jolly well matters now. The current economic crisis clearly marks a sea change in economic power, which is moving from the US and Europe to China and India, the resource-rich countries of the Gulf and elsewhere.
The IMF completely fails to reflect that. Voting strengths are: China, 3.66; the US, 16.77 and the UK, 4.86. Although that changed earlier in the year, it needs to change more. The weakness of the IMF in terms of perceptions can be seen if you look at the way that Pakistan looked to get its support. It described getting support from the IMF as plan C. It tried China first and the Gulf second. The IMF was plan C. It should be looking to the IMF as plan A, because the IMF should be a trusted institution. There should be changes in the way that people are appointed and changes as regards transparency. It does not publish its minutes for 20 years after the executive committee meets, which is a joke. All these things need to happen if it is to be treated seriously by those countries which traditionally have played a small part.
Secondly, the IMF needs to have a lot more resources. People have bandied about the fact that it might need $2 trillion instead of $200 million, and the Prime Minister has talked about a bail-out fund. In the past week, every day there has been a major new development involving the IMF. Yesterday, it was looking at new rules to enable it to make grants to countries more quickly. Literally earlier today, China announced its willingness in principle to contribute to an enhanced international bail-out fund; the implication being that it would be administered by the IMF. So far from being a dead institution, it clearly is seen as an institution with a major role to play. I fear, however, that the meeting planned for 15 December will not lead to its reform. What we need is a long-term, thought-through series of meetings to get the real reform which will enable the IMF and the other international financial institutions to fulfil the purposes, if not quite those envisaged at Bretton Woods, which the world now sees they need to fulfil.
I, too, congratulate the noble Lord, Lord Bilimoria, on securing this short debate, and, indeed, on securing a star-studded list of speakers to contribute to it.
I am sure that the IMF and the World Bank did a fine job in helping the world economies to be rebuilt after the Second World War. Like the noble Lord, Lord Newby, I shall concentrate my remarks on the IMF, which has continued to support economies which have run into trouble, including, of course, our own during a period of Labour Government mismanagement of the economy in the 1970s, and we should not forget that. But, of course, a valuable history does not guarantee the IMF a place in the future. After the Asian financial crisis in the late 1990s, the IMF admitted that it had “a lot to learn” about preventing financial crises. As other noble Lords have said, it is fairly clear that it played no positive role in the current global financial crisis as it evolved. Therefore, we have to ask whether the IMF really has a role beyond that of clearing up after the event on an ex post basis.
The IMF spends a lot of time analysing countries and issues a lot of reports, but it seems to have no real influence unless it has a rescue package to which it can attach some levers. I give an example. In the 2006 Article IV consultation on the UK’s economy, the IMF warned about the UK’s high household debt, its overpriced housing market and the high leveraging of our mortgage lenders. It concluded that the UK was particularly vulnerable to shocks in international markets. All of this has proved very accurate. We challenged the Government about it at the time, but it was all too easy for them to ignore the analysis.
There also have to be questions about the quality of the IMF’s analysis. In 2003, the IMF completed a financial sector assessment of the UK, which described our financial stability policy framework in glowing terms. But that is the framework that included the FSA, which regulated Northern Rock appallingly badly, and the tripartite arrangements, which were a shambles when put to the test. What value does the IMF add, with reports that can be ignored or which, with the benefit of hindsight, flattered to deceive? Is the IMF simply too polite about countries such as the UK, whose support is important to its continuation?
As has been mentioned, there have been calls from the Prime Minister, certainly since 1998, for changes to the international financial architecture, and no one has been really sure what that has meant in practical terms. Indeed, there has been no tangible action in that period, though of course there are thousands of worthy words written on the subject by bodies such as the Financial Stability Forum. Yesterday, we heard from the Chancellor that there will be 30 colleges of regulators, but apart from that, we are still only promised more meetings on the subject. Is there any substance to the latest round of rhetoric? I hope that the Minister will be able to enlighten us.
Apart from grand plans to reform the international financial architecture, there are some short-term issues about funding which some noble Lords have already mentioned, given the queue of countries now waiting for some help. In 2006, the IMF sold off some of its gold to fund its operations and thereby ran down the resources that it had available. As the noble Lord, Lord Newby, pointed out, the Prime Minister called for hundreds of billions of extra dollars in a bail-out fund. The noble Lord, Lord Newby, is ahead of me in hearing that China has signed up. When I was researching this yesterday, there was deafening silence on whether anyone was going to put their hand up or indeed put their hand in their pocket. Maybe we will get some extra money into the IMF, and I am sure that will be helpful.
This week, we have seen that there are separate and partly competing EU, US, IMF and World Bank funding initiatives. Does the Minister think that this patchwork of different initiatives to support countries is the most efficient way of delivering support? Do the Government think that the IMF and the World Bank should be at the heart of those efforts, or are we witnessing a nail in the coffin of the positions of those bodies in the global economy?
I should also like to express my appreciation to the noble Lord, Lord Bilimoria, for securing this debate. This is my first contribution to a debate since my maiden speech earlier this week. I have handed in my registration of interests, but it has not yet been processed. I assure the Committee that I have nothing relevant to declare, save that which we all have that is relevant to declare: a real interest in the truly extraordinary issues facing the world at the moment in terms of financial instability, the performance of the global economy and the needs and interests of those in the developing world.
Institutions such as the IMF and the World Bank have a key role in assisting countries hit by negative shocks, but recent events in financial markets have confirmed that the world economy has changed irrevocably. The noble Lord, Lord Bilimoria, started with a quotation from Keynes. Having also recently read the book by the noble Lord, Lord Skidelsky, I shall take a quotation from Keynes:
“The difficulty lies not so much in developing new ideas as in escaping from old ones”.
One of the challenges for us in our role in supporting the IMF, the World Bank and other institutions is recognising that in a changed environment they themselves must have changed roles, changed processes and changed cultures.
The noble Lord, Lord Bilimoria, reminded us of the critical interdependency between economies. These are not times when single national initiatives alone will suffice, although the initiatives taken by this country and others to support confidence in their own banking and financial institutions have clearly played a very valuable part. Contagion is a word that we now come to associate with global economics and global finance. The Government support the strengthening of the robustness of international controls. In particular, my right honourable friend the Prime Minister has emphasised the important role that he sees for the Financial Stability Forum, which will certainly need more resource than it currently has, and to which the noble Viscount, Lord Eccles, alerted us. We see a more assertive role for the Financial Stability Forum in accounting, rating agencies, and the regulation and transparency of the derivative markets—in short, a role that meets the call of the noble Viscount for it to be proactive rather than reactive.
We support the expansion of the top table at the World Bank and the IMF through the extension of its membership, which the noble Lord, Lord Bilimoria, talked about. We have also publicly spoken about the unacceptability of the gentleman’s agreement under which the leadership of the World Bank and the IMF is determined, and we have argued forcefully for an open and transparent process of appointment that leads to the best equipped people being appointed to those important roles.
In response to the observations of the noble Lords, Lord Bilimoria and Lord Parekh, about supporting the institutions and making them become more legitimate, I should say that we have agreed that the IMF quota reform in April 2008 was an important further step towards making the organisations stronger and more accountable. As I said, we support making them much more open and transparent about the performance of their duties. The UK has also been vocal in support of the IMFC chair coming from an emerging market economy.
My noble friend Lord Desai argued the case for abolishing the IMF. I am not persuaded at this point that substituting IMF support for support from a consortium of private banks is entirely the best approach. Indeed, some of the difficulties with which the IMF is now coping are a direct consequence of the need to substitute private bank-provided finance which has been used to support long-term capital investment and budget deficits in a number of countries. He made a more powerful point about the need to change the way in which the IMF works if it is to perform an effective function in the future.
The noble Viscount, Lord Eccles, invited us to speculate that reference to architecture is spin rather than substance. I assure him that it is not. We are talking about putting our shoulder to the wheel to ensure that fundamental changes are made in the IMF and the World Bank to improve their efficiency and make them relevant to the needs of today. The noble Viscount also asked whether the reports from the IMF received as much attention as they should have done. That is an endemic problem. My former colleagues at the Bank of England would point to the fact that they alerted us to difficulties in the banking sector to which the sector itself seemed oblivious. I can think of ways in which the IMF and the World Bank could communicate their views more forcefully. Indeed, a report on the actions taken subsequent to their analysis and the publication of their views would be an important step forward. My right honourable friend the Prime Minister has already argued in support of this.
I am indebted to the noble Lord, Lord Skidelsky, for his economic analysis and his focus on the absence of constraint and the persistence of imbalances, which are the fundamental source of the instability with which we are now coping. His remarks were trenchant, powerful and highly relevant.
The IMF and the World Bank are responding to the challenges. The IMF has made up to $250 billion available to support nations affected by the global financial turmoil, and the fund is already in discussions with several countries to provide advice and, where necessary, to bolster countries’ reserves. I am delighted to see that the call made by my right honourable friend the Prime Minister to supplement the resources available to the IMF through the concept of a trust fund in which those countries that are in substantial balance were able to provide funds which would be invested alongside the IMF, has led to such a positive response from China, as the noble Lord, Lord Newby, told us today. We hope that the Prime Minister’s visit this weekend to the Middle East will be a further step in advocating the case for putting more resources behind the IMF in the future. It is clear that demands on the IMF for resources are going to be considerable.
The noble Lord, Lord Newby, made the case for stronger and more effective surveillance and asked questions in that respect about Iceland, a country about which I have become increasingly knowledgeable in recent days. I share his interest in what we will learn from that. He made the important point that the IMF needs to improve and to become a trusted, accountable and effective institution. He said that if it did not exist, we would probably have to invent it. Rather than invent something, why should we not do what the Government are encouraging: promote an improvement in the culture and processes of the IMF and the World Bank?
The current economic conditions may be such that significant additional resources are required, and we are taking steps along with other Governments to ensure that that is achieved. The World Bank has made contributions through its rapid finance facility which was established earlier this year to support countries affected by the food and fuel crisis. The noble Earl, Lord Sandwich, reminded us of that there are great difficulties and poverty in many parts of the world which we must not overlook. Strengthening our economy and banking system is an important step to facilitating our ability to do that. We support a louder voice for countries from developing nations in the IMF and the World Bank, including countries in sub-Saharan Africa. The Prime Minister has been clear in his recommendations on that point.
The Government have an important role in mobilising the resources of the IMF, the World Bank, the G7, the G20 and ECOFIN. The noble Baroness, Lady Noakes, questioned whether competition is the right approach here. I would normally expect to hear support for competition from her Benches. There is a case for plurality and for mobilising as many institutions as possible, with the Government acting as a linking mechanism.
I thank the noble Lord, Lord Bilimoria, for arranging this debate. I have personally found it extraordinarily helpful, and I am encouraged by the contributions from all sides of the Committee.
[The Sitting was suspended from 4.59 to 5 pm.]
Taxation: Inheritance Tax
asked Her Majesty’s Government whether they propose to review the application of inheritance tax to cohabiting and dependent close family members.
The noble Baroness said: I am grateful to those who have come to discuss a topic which, I admit, I have raised earlier and on which many others have commented. I do so because of the unusual cross-party support that has been evident for what I propose. Thus, I urge the Government to implement it in the Finance Bill. I propose a small, humane change that will cost the nation nothing: that two close relatives who are living together at the time of death of one of them, who have lived together for seven years—echoing the period during which one may transfer assets before death—and who assert codependency should be entitled to defer the payment of inheritance tax until the death of the second.
It has often been said that there are problems of definition of who those people should be. I propose either parent/child and siblings, including half, step and adopted relationships or, more logically, all those relatives who fall within the prohibited degrees, which is quite a small category, because those are people who cannot get married and cannot form civil partnerships. So there is no real problem of definition.
What I suggest would cause no loss to the Treasury because the full amount of tax will be forthcoming eventually. Indeed, my proposal may save resources by avoiding the sale of a property to fund the tax, probably in the declining years of the survivor, which may result in the survivor going into a home. We know that the sale of a home is one of the traumatic events of older life to precipitate a turn for the worse.
Just as important in this discussion is the establishment of common sense in inheritance tax law. That common sense has been lost since the death tax advantages that attached only to marriage were extended to same-sex civil partners by the 2004 Act, but were denied to relatives. That was because representatives of at least two parties and the Minister said that the Civil Partnerships Act was the wrong place in which to enact that relief; they did not say that they disagreed with it. On the contrary, an amendment by the noble Baroness, Lady O'Cathain, was passed in this House but defeated in the other place. The principle was supported by, for example, the noble Lords, Lord Alli and Lord Goodhart, and the then Deputy Minister for Women and Equality, Jacqui Smith MP, who all said that the Civil Partnerships Act 2004 was not the place to achieve it.
I became interested in this topic because one of my most brilliant former students at Oxford was counsel for the two sisters in the case that I am about to describe. Not only was he my student, but he is to be introduced into your Lordships’ House in a few days time as a new Cross-Bencher, David Pannick, QC. He is wholeheartedly behind my proposal, and it is a matter of regret that it is too soon for him to join the debate.
The case to which I refer, and which is the best known in this field, is that of Miss Joyce and Miss Sybil Burden, sisters in their 80s who have lived together for 82 years. They remain single. They cared for their parents and two aunts to the end and did not allow them to go into a home. On the death of the first sister, inheritance tax is estimated to be around £120,000. All this is in the public domain because of the judgment in which the sisters lost their case of discrimination before the Grand Chamber of the European Court of Human Rights. The Court held that marriage was different. With respect, the judgment is unsatisfactory not only because of the narrow defeat in the Court but for the lack of logic. The Government took down the barriers between marriage and other forms of association by enacting advantages for same-sex couples entering a civil partnership.
This dismantling of a centuries-old definition recently gave rise to more demands. It is now being demanded by some that cohabiting different-sex couples should enjoy the same rights as married and civil partnerships. I hasten to distance myself today from that proposal. My position is not connected with the debates about the breakdown of cohabiting different-sex couples where two people who could have married have fallen out. I would say in parentheses that if two people who are free to marry do not do so, it is a denial of their human rights to force on them the least satisfactory elements of marriage, the money laws, and to remove their freedom to make their own contracts. The definition of cohabitation between two people of different sexes is difficult and open to manipulation, unlike the proposal I am making today. Bringing marriage law to bear on cohabitants of different sexes may eat up in legal costs an amount as big as the resources in dispute. It will certainly open the door to harassment through the threat of action as a man and woman separate.
I have touched on the cohabitation proposals today because it is vital that the small amendment I am proposing is kept distinct from well-meaning but ultimately damaging attempts to create a full marital-type regime for heterosexual cohabiting couples. If that is combined with my proposal, it might sink it because of the deep resentment it causes in some quarters, I think for good reason. My case before your Lordships is for the mere deferral of inheritance tax payable on the death of a first sister in a relationship that is never ended except by death, where there is undoubted commitment and where one needs to avoid rehousing, and where it would be sensible to avoid the need to move house or borrow large sums of money at a vulnerable stage in life. This fits exactly the Government policy of keeping people housed, recognising the arrangements that people want for each other, and respecting the elderly. It would also recognise the invaluable service performed by carers, such as that performed by the daughter who gives up her independent life for an elderly parent living in the same house. After decades of devoted care the parent dies and the tax problem is incurred by the devoted carer, who should be recognised. I think it is the policy of this Government to assist carers who do a good job and relieve the state of such burdens.
If my suggestion is not adopted, I and possibly many noble Lords will be very puzzled. We will wonder whether it is not necessary to have a Royal Commission on the financial recognition that should be given to the whole variety of relationships that exist today.
I can see no case for giving generous treatment to civil partners and married people when it is not available to those who cannot enter a formal relationship, whose contracts may not be recognised by the courts, and who, as the sisters say, have tried every way to avoid the burden of the inheritance tax that is likely to fall on one of them. I would be very grateful to meet the Minister to discuss this. I take the liberty of urging him in the mean time to undertake to achieve this small, cost-free and kind deferral in the Finance Bill, which would be welcomed by so many in this House and by so many who have rendered valuable service to each other and to society.
It gives me great pleasure to support the noble Baroness in her plea. One of the glories of the parliamentary system is the opportunities that it provides, away from the big set-piece debates and away from the clash of party animosities, for issues of principle and injustices to be raised in a manner in which one can have a civilised and straightforward dialogue with the Government of the day. The noble Baroness has drawn attention to one of those issues involving small numbers of people, with no great lobby to support them, who suffer a severe injustice.
It is very hard to say anything original on this subject after the speech made by the noble Baroness and after the exchanges that have taken place on the Floor of the House. The situation is very clear, and she has set it out very clearly. Basically, one is repeating many of the same arguments, which does not diminish either their force or the feeling behind them.
In my opinion, the establishment of civil partnerships has rightly given same-sex couples the same tax situation on death as married couples. In this respect—I am speaking here of financial and secular matters—marriage has lost its special status and an equality, which I support, has been established. It has been established, as I understand it, in the context of a belief on the part of the Government, and again I support this view, that it is right to promote stable, long-term family partnerships. If it is right to do so outside the framework of traditional marriage, I find it very difficult to see the objection to the proposal that the noble Baroness has put forward. Two members of the same family—whether sisters, brothers, parent and child, or, as the noble Baroness said, wider—can have as much co-dependence and as much of a supportive relationship as married couples and civil partners. Indeed, precisely because of the informality of the arrangement and the fact that there is no way of formalising it in law, the bonds can in some respects be deeper, longer-lasting and of a very particular order, based on supportiveness and caring one for the other.
It is very difficult to see an argument in principle against this, and it is equally difficult to see an argument in practice. The problems of definition, which at one time seemed rather difficult, were admirably dealt with by the noble Baroness, Lady Deech. It may be that the Government would wish to change them in some respect, but basically they seem to be very straightforward. I can see no rational argument, nor even a financial argument, why the proposal should not be accepted. Therefore, I add my voice to that of the noble Baroness and others in pleading with the Government to right a wrong for a small number of people, which will get very little publicity and which probably will not make any difference to their poll ratings, but which will be an act of justice and which will be thoroughly worthwhile.
I start from the premise that inheritance tax has a valid role to play in our tax system. First, in a society in which social mobility is recognised to be declining, it is reasonable to take some steps to even up life chances. Secondly, the argument that inheritance tax is taxing assets that have already been taxed is largely false, since most of the assets being taxed are housing, on which no tax has ever been paid. I rather regret the auction of promises that broke out about a year ago. In particular, I feel that raising the allowance to £1 million, then doubling it and allowing that to be transferable, goes too far.
Even under the old system, two groups of people felt particularly disadvantaged; namely, siblings and surviving carers. In particular, these people are often asset-rich and income-poor. The disadvantages can be narrowed down to two; namely, a disadvantage in cash flow when the bill is paid and a disadvantage in how much is paid. HMRC makes some concessions on the cash flow: a tax bill can be paid in instalments over 10 years at a quite modest rate of interest. It is argued that equity release products are available from banks and insurance companies to enable people to borrow the money. But even before the credit conditions of the past few months arose, I do not think that there was a queue of banks and insurance companies wanting to lend 80 year-old ladies £10,000 this year, another £10,000 the next and more the following year. That is not a valid response.
The sense of grievance among these groups has increased for two reasons. Those who benefit from the spouse arrangements have been widened by the Civil Partnership Act and the arrangements have been made more generous by transferability. There are two levels of remedy. First, siblings and carers could still be regarded as individuals, but when the tax bill crystallises on the first death, that amount could be deferred with modest interest until the second death, as proposed by the noble Baroness, Lady Deech. The second remedy would be for these groups to be given the same benefits of transferability that are now available to people in marriages and civil partnerships.
In my view, the Government should accept the first remedy immediately, which does not break new ground. If, instead of leaving her share in the family home, the first sister leaves an old master painting, a plantation of trees, a farm or a business, the tax could be deferred even more generously than the existing 10-year arrangement. If this is accepted, it would deal with the cash-flow problem.
There would still, however, be the problem of equity. Previously, apart from when the tax was paid, the difference between the amounts of tax paid was not huge. But now it has become enormous and there is a case for saying that inheritance tax is transferred between generations. Here, in effect, there would be two transfers within the same generation; that is, the second sister would pay tax on her share of the joint wealth, plus the money that has been left to her after the first sister’s share has been subjected to tax. In effect, you have two rounds of tax coming one on top of the other. There is provision in the Inheritance Tax (Formerly Capital Transfer Tax) Act 1984 for “quick succession relief”. There may be a way to build on this, but I am told that at the moment it does not operate generously.
Clearly, in this case, money is not the issue. According to last autumn’s pre-Budget documents, the benefit of allowing spouses to pass money to a surviving spouse was £1.9 billion. The proposal put forward by the Government to allow the allowance to be transferred would be another £1.2 billion. In these absolutely colossal sums, if anyone wanted to raise that as an issue, I am confident that money could be found to deal with the probably limited number of cases indicated by the noble Baroness.
I draw the Committee’s attention to my interest declared in the Register. I congratulate the noble Baroness, Lady Deech, on securing this debate.
I want to say at the outset that the main objection to inheritance tax is not double taxation, but that the very rich do not pay and the burden of the tax falls on middle England. That is what is so unfair about it. Quick succession relief is no assistance at all because it will bite on the second death, not the first, and it is the first death where the problem lies.
I was fortunate to have the opportunity of having two debates on inheritance tax, the first on 1 February last year and the second, which was on inheritance tax and capital gains tax, on 22 April this year. In the first debate I had a measure of success, because I advocated, among other things, transferability of nil-rate bands, and six months later the Government introduced that and made a modest increase in the nil-rate band. That was welcome.
I made a point in both debates of suggesting that siblings should be treated more fairly. There should be fair treatment, but it has to be narrowly defined. My view is that there should be a more generous relief between brothers and sisters, although it should not really go further than that. They cannot marry—that is a very powerful argument—and they cannot form civil partnerships.
If one alters the rules and makes them more generous so that it carries through the generations, though, you will have opportunities for tax avoidance. For example, if a mother dies, leaving her estate to her bachelor or married son—that is an exempt transfer because of what has then been allowed, which I am sure will not be allowed by the Government—the son then has a large estate. Say he is a bachelor when he inherits from his mother but then marries and leaves his entire estate to his widow; again, that will be exempt. This has to be rather carefully dealt with.
There is a powerful point regarding carers, which I mentioned in both my debates. Carers should have a more satisfactory, fairer and more sympathetic tax regime. I wonder if the Minister can talk to us a little about the possibility that commercial arrangements can be made along the Boden and Ralli principles—two cases in New South Wales from the early 20th century that are powerful precedents in this country—such as constructive trusts and so forth. For example, at the age of 70, Mrs Bloggs says to her daughter, “Please look after me, and when I die this house is yours”, and the daughter does exactly that and forsakes the opportunity of buying a house herself. There should be something along those lines. It is possible, I venture to suggest, and it will be interesting to hear what the officials have to say about this, that constructive law and commercial arrangements should be upheld in those circumstances. To the extent of that particular asset, it should pass as part of a commercial arrangement. I declare that I have an argument along these lines currently going with the Capital Taxes Office. So far, not so good, I am afraid.
There are these close family relationships between brothers and sisters. They rely on each other and live together. Of course they should be given favourable tax treatment. They should have an opportunity to make an inheritance tax election nominating their exempt beneficiary for inheritance tax purposes. If such an election were made, they should be treated, in terms of benefits and other such matters, as a married couple.
There is a plus, and possibly a minus, to that. The noble Baroness, Lady Deech, has made a very powerful case but, in my view, it should be limited to brothers and sisters. That would be far fairer. In those circumstances, I can see no reason why the Government will not give a very modest degree of help. It is not as if these people are isolated; there are a great many people of that sort, especially living in rural England. I hope that the Government will think again on that point. I say again how grateful I am to the noble Baroness for raising this very important point.
I congratulate the noble Baroness, Lady Deech. She has highlighted and made a very strong case demonstrating flagrant discrimination against sisters and other family members who have often cohabited for a long period. I totally endorse what she said.
However, in hoping that the Government agree to deal with that very small change in legislative terms, in the longer term, for reasons of equality, parity and basic fairness, that could not be restricted to siblings alone. I want to emphasise the situation of long-term carers who are not related, but who may have spent 20 years together and devoted their lives to caring for someone, forfeiting their chance of a decent income from work and a subsequent pension and even of an adequate social life. In such cases, we are punishing a person for not having a sexual relationship, which is an anomaly which I am sure that your Lordships’ House would want addressed and which I hope that the Government will take very seriously.
This is not restricted to women; it often applies to men. In fact, in 1986, in the UK, 11 per cent of unmarried men aged under 60, and 13 per cent of unmarried women aged under 60, cohabited. Those proportions had roughly doubled by 2006. Many of those households consist of carers and cared-for people for a very long time. Social Trends reports that:
“The number of households with two or more unrelated adults sharing private accommodation ... has remained stable at 3 per cent”,
since that work was undertaken. Sometimes, those are family members. Focus on Families reports that the sample sizes of cohabiting carers are too small always to differentiate between carers and cohabiting relatives. We must take long-term carers into account.
I agree with the noble Baroness that any change in the law could initially be limited to sisters or family members, but in the long term, those anomalies must be addressed as a matter of some urgency to help people who, when the person they loved and cared for over many years dies, are suddenly left with having to get rid of the family home. That cannot continue and must be addressed.
I, too, congratulate the noble Baroness, Lady Deech, on introducing this debate. As far as I know, it is the first time that we have had such a debate to urge on our colleagues in the Commons an amendment to the Finance Bill. As a general principle, we in your Lordships’ House have too little influence on Finance Bills, so that is a particular reason to welcome the debate.
I start from the same position as the noble Lord, Lord Turnbull, in believing that there is value in inheritance tax in terms of equality. I do not seek to undermine inheritance tax as a tax in any way. I also start with a background in this. My formative professional years were spent in Customs and Excise, where anyone who suggested any tax relief rapidly became a pariah among their colleagues. This experience and recollection are always on my shoulders.
In this case, the arguments as they relate to siblings are absolutely straightforward. I see no argument of any substance for denying siblings the right to benefit in the way that the noble Baroness proposes today. She referred to our debate on the Civil Partnership Bill, to which the noble Baroness, Lady O’Cathain, proposed a broadly similar amendment. We voted against that amendment, more because of the overall context of the debate than the specific issue of inheritance tax and siblings.
We need to be very clear about the definition of other family members. My mother lives next door to a family whose son was born in the house and has lived in the house until today. He is now broadly speaking my age: perhaps slightly younger. His mother and father lived in the house with him. His father died, his mother recently died, and he is now living alone in the house. It is not clear whether he was ever formally a carer. He looked after his mother to a certain extent, but he certainly did not give up a career to do it. He gave up no more than anyone would give up when looking after a relative as they got older. It is not clear to me that he should automatically benefit from this kind of relief. As it happens, the house is not above the inheritance tax threshold.
The amendment proposed by the noble Baroness, Lady O’Cathain, related to people over a certain age who had lived together for a certain amount of time; I think she proposed 12 years. These are narrowing definitions, which I would support, rather than a simple blanket provision.
The broader proposal made by the noble Baroness, Lady Greengross, warrants further consideration, because the value of carers to society is clearly very great. I have seen the old and frail parents of family members and friends having to rely on the state, on their own resources or on third parties to look after them, and finding either that the provision is not very good or that the financial burden of getting in paid caring staff is considerable. It is therefore in the interests of the state to see how carers can be supported in tax-efficient ways. This may be one way of doing it. It is not a proposal that I had heard about before today, however, and I want to look at it further before formally committing myself to it. It certainly has a number of merits.
I very much hope that the Minister can be rather more generous-spirited than he was when we debated this earlier this year. His arguments had little or no merit, frankly. I know him to be a generous-spirited man, and I look forward to his reply.
I do not think that I will be echoing those sentiments. I congratulate the noble Baroness, Lady Deech, on securing this debate. As the noble Lord, Lord Newby, has pointed out, we are not normally allowed to dabble in tax matters, and are certainly never allowed to propose amendments to a Finance Bill or, indeed, to propose tax law generally. We are not, fortunately, prohibited from debating the issues, and we have had many fine debates on inheritance tax, led most recently by the noble Lord, Lord Burnett, and have had another good debate today.
Inheritance tax is an unfair tax. As the noble Lord, Lord Burnett, pointed out, it tends to attack middle England, while the rich can use a number of mechanisms to avoid or minimise its impact. Middle England has increasingly been dragged into the inheritance tax net, principally because house prices outstripped the general inflation increases to the IHT thresholds.
In the 10 years from 1997, the proportion of estates paying inheritance tax doubled to just under 6 per cent, though the changes that the Government made in this year’s Finance Act should reduce that by about a third. The inheritance tax yield is actually very low. The Government raise relatively little from it. But, of course, in these straitened circumstances, with the Government’s cupboard being virtually bare, any amount raised in taxes is something they would find difficult to give up, though it has to be noted that it is also one of the most expensive taxes to raise, with costs being over 1 per cent of the yield. Therefore, it is not a particularly efficient tax.
Overall, my party is not a fan of inheritance tax. We believe that there are theoretical objections to it. I note the views of the noble Lord, Lord Turnbull, but we see the element of double taxation, because it taxes wealth which has been accumulated from taxed income—perhaps not entirely, but it certainly does do that to some extent—as a very important issue. We also believe that it does nothing to encourage savings. Unlike the Government, we believe that savings are an important issue. The savings ratio has virtually disappeared in the past 10 years. We think that there should be incentives to save. Even Mr Stephen Byers, not normally seen as a right-wing thinker, described inheritance tax as a penalty on hard work, thrift and enterprise.
But statistics and theories mean absolutely nothing to ordinary families. For them it is the possibility of paying inheritance tax on modest wealth which is so distressing. That is why the subject has a political resonance which goes way beyond the bare statistics of yield and numbers of estates paying tax.
My party’s policy is to increase the inheritance tax exemption to £1 million and this would be transferable between spouses and civil partners, as is the Government’s exemption. The Government often copy our policies. They knew that we had touched a chord in middle England when we announced our £1 million exemption. However, instead of copying our policy properly, they produced their own half-baked version of transferability of the existing exemption limits. It is because the Government were so timid in relation to IHT that it remains a big issue. It may have been partly neutralised as between married couples and civil partners, but the increased generosity for them was not matched by generosity for any others. That is why there continues to be a call for some of the remaining inequities to be dealt with. The noble Baroness, Lady Deech, has well outlined the case for cohabiting and dependent close family members, but the issue can as easily be dealt with by raising the threshold. If it were increased to £1 million, as is our policy, the case that she has put would fall away because relatively few estates would need additional relief.
As has already been said, when the Civil Partnership Act was considered in your Lordships’ House, my noble friend Lady O’Cathain, whom I am glad to see is in her place, successfully moved an amendment which would have allowed close family relations who had lived together for a period to register a civil partnership. I believe that the motivation behind my noble friend’s amendment was the inequity of inheritance tax, though, of course, civil partnership brings in other tax and benefit changes. The Government overturned the amendment in another place. This was an area where my party, unlike the other parties, had a free vote. I have to say—I think that my noble friend already knows this—that I supported the Government’s position on that, not because I have no sympathy for the dependent relatives involved, but because I was concerned, like the Government, to keep the concept of civil partnership relatively discrete.
I have much sympathy with the issues that the noble Baroness raised so well this evening, but I am far from convinced that the answer lies in creating special tax reliefs. Our approach to tax is driven by a desire for simplicity. If the noble Baroness’s wishes were granted, I can guarantee that for every line of tax legislation which introduced the reliefs, there would be 20 or 30 lines of anti-avoidance provisions. The noble Lord, Lord Burnett, with his inventive mind on this subject, referred to the possibilities for avoidance. This is the path that the Government have consistently taken on tax legislation over the past 10 years and it is the very antithesis of the path that my party would want to see tax legislation taking.
I am sorry not to be able to pledge my wholehearted support for the noble Baroness, Lady Deech, in the specifics of her proposals, but I hope she sees that we would want to achieve substantially the same result by another route.
I am grateful to all noble Lords who have spoken in this constructive and interesting debate, and in particular to the noble Baroness, Lady Deech, both for introducing the debate and for presenting the case with such sensitivity and care. I want to address the politics first. I heard what the noble Baroness said in a little knockabout regarding the virtues or otherwise of inheritance tax. However, these are changing times and if she is going to have a dip at the Government that we are concerned to maintain revenues—we certainly are—is she prepared to see no value in inheritance tax so that the ill-gotten gains of those huge bonuses and resources that have gone to bankers will be free of taxation when they pass on? She is welcome to argue that case, but I will maintain the position of the Government, which is that inheritance tax is an important part of taxation, although as she and other noble Lords have rightly indicated, it raises a relatively small proportion of the total resources available to the nation.
I will be cast as the bad guy because I am not going to be able to accept the argument put forward by the noble Baroness, Lady Deech, and supported so well by other noble Lords who have spoken in the debate. However, I understand entirely the motivation behind her proposal and the concern that fairness should be observed for our fellow citizens. We all recognise that although the Burden case did not convince the European Court of Human Rights and was rejected, we have sympathy for the nature of the case and we know of others in a similar position. If we were not concerned about this issue, we would be lacking in basic humanity and unable to see the difficulties that people can face. However, I want to emphasis this: the reason why we cannot accept the premise behind the noble Baroness’s case is that we need a basis in law.
Before the recent legislation on civil partnerships, the reason why inheritance tax exemptions related only to married couples was straightforward. It was a question of the law: marriage is a state entered into as a legal position, and a civil partnership now reflects that. The trouble with any definition that departs from the law flows from two considerations. First, there will always be hard luck stories. If it was said, for example, that the exemption should apply to siblings who have lived together for 20 years, what of the pair of siblings where one of them dies after 19 years? There would be concern about such a situation and the problem of the hard-luck case would not be solved. The second difficulty is obvious enough. The moment we move from the straight legal position that clearly defines who is entitled and who is not, the Revenue would become involved in investigations and intensive scrutiny in order to see whether the couple qualify by meeting the criteria.
We all have proper reservations about the extent to which the Inland Revenue carries out inquiries of that kind. There are real difficulties about a sensitive circumstance after a death where scrutiny would have to be applied to the nature of the relationship that obtained before the death had occurred.
I am sorry to intervene, but the Minister is running together a situation for married couples and civil partnerships where inheritance tax is exempt and the proposition advanced by the noble Baroness, Lady Deech, that inheritance tax be deferred.
If it is suggested that there is no cost attached to the Treasury with regard to deferral, that is obviously not so. Of course there is a cost when resources are not being returned in the year for which deferral takes place. So we have that problem; the question is how extensive it would be. We are not talking about one of the major revenue taxes in the land, but that does not alter the fact that taxes have to be applied with fairness.
At present, it can be in the interests of those who secure the inheritance to emphasise the costs that they may sustain, which might even lead to the loss of the house in which they live, which is the most acute loss. However, the Revenue is not in the business of turfing people out of their houses. In those circumstances, it carries out the process of deferral, which has been identified, over a period as long as 10 years, and graduates the payments that need to be made. I may appear somewhat heartless on behalf of the Treasury in not accepting the full argument that has been presented today, but I would be selling the Inland Revenue very short if I did not emphasise the care that is taken in circumstances where real hardship might obtain, particularly the loss of a home, through the application of the inheritance tax.
I am sorry to intervene, but we have time and I want to clarify the position. When I brought this suggestion up in the first place, we thought that the house was the major capital asset. Things have changed, however. It is fine for the Minister to say that Her Majesty’s Revenue and Customs could defer the payment, but if the house were actually falling in value—we are now realising that houses are not always an appreciating asset—what would be the situation then? There would be genuine hardship. People would be left homeless, because there would be no way they could pay the deferred tax on an asset that they knew at the end would leave huge debts.
That has not been the situation in the recent past. We are in changed circumstances, and those very circumstances mean that the Treasury is scrupulous in defending the revenue to which it is entitled. I understand what the noble Baroness is saying, and there may be a greater number of cases than at present where the necessity for deferral and consideration by the Treasury is to be taken into account. The Government have already said to mortgage lenders that we expect there to be consideration of special circumstances in order to minimise repossession so far as we can—we all recognise that the numbers are increasing. By the same token, it is to be anticipated that the Revenue, which is well used to using deferral procedures with regard to inheritance tax, will have to deploy them rather more extensively if property values decline substantially and over a period of time. Of course, we all hope that we are talking about a drop that is not too far and a time period that is not too long. I hear what the noble Baroness says, and I merely give an assurance about the Revenue’s responses to that position.
I fully understand the questions asked by the noble Lord, Lord Burnett. On the Australian example, I am not briefed on that legal case, and I will have to respond to him in writing. The briefing is fairly extensive, but it does not go quite that far.
These cases may have emanated from New South Wales, but they are very good law in Britain, which practitioners sometimes forget. I very much look forward to hearing from the Minister in a letter exactly what the Revenue’s view is on constructive trust matters, and particularly on commercial arrangements for carers. That is very interesting for all of us.
I take what the noble Lord says, and I shall write to him. I am not a practitioner, but nor have I forgotten it readily, because I never knew it. Therefore, when I write to him I shall be on a learning curve, as most others would be in my situation.
I say to noble Lords, and in particular to the noble Baroness, Lady Deech—she deployed the case so ably and I understand its significance—that we are not persuaded at present that it is possible to draw a line, which would have to be a legal definition. We are not going to allow the Treasury—no noble Lord who has spoken in this debate would—the degree of discretion to say that it should make an adjustment on whether it thinks that siblings have been carers or how long they have been together. The great danger is that any change could affect human behaviour. If it were the case, in the most extreme circumstances, that siblings merely living together for a year would solve the inheritance problem, we would see long-lost love between siblings who had been apart for a long period of time being brought together when illness occurred. I know that the noble Baroness, Lady O’Cathain, thinks that I am little far-fetched on this. There are big resources at stake in particular circumstances of inheritance tax, and it would not be right for us to be innocent about that.
I just ask for clarification. Is the meaning of the Minister’s words that if we on our side can come up with a good definition, the Minister would be happy to arrange the deferral?
That is pressing me a little far. The noble Baroness will recognise the position of the Treasury’s defence on this. We have a clear definition in law of those who are entitled, and we would need a very clear definition before there was any possibility of departure. I do not accept that there is no cost involved as far as the Treasury is concerned. She will forgive me if I emphasise that point. It may be marginal, and it may be suggested that there is a counterbalance because people’s behaviour in caring for each other may save the state costs in other respects. That is an issue that I know we will debate in future, as we have debated it so often.
From the point of view of the Treasury, there is bound to be the question of legal definition, and a substantial case has to be put against it—at this time of all times—of what the advantage would be against the inevitable cost in terms of lost revenue.
I absolutely take the point that the Treasury would experience a cash-flow problem with a temporary deferral of perhaps 10 years, which might be the maximum age span in probable death between, say, siblings. The noble Lord, Lord Turnbull, also mentioned the possibility of some modest interest. After that initial 10 years, the fall-in to the Treasury of the total sum due would be exactly the same as now. The cost is so marginal that you can barely count it.
The cost is there and I am not prepared to concede that point of principle at this stage. Nor am I prepared to concede the point that everyone else has stuck to their time limits, but I have taken 14 minutes when I only had 12.
The Committee adjourned at 5.55 pm.